scholarly journals Coordinating Three-Level Supply Chain under Disruptions Using Revenue-Sharing Contract with Effort Dependent Demand

2016 ◽  
Vol 2016 ◽  
pp. 1-10 ◽  
Author(s):  
Qinghua Pang ◽  
Yanli Hou ◽  
Yifei Lv
Keyword(s):  
Supply Chain ◽  
Revenue Sharing ◽  
Optimal Contract ◽  
Market Demand ◽  
Numerical Examples ◽  
Revenue Sharing Contract ◽  
Special Case ◽  
Additive Form ◽  
Dependent Demand

Considering that the market demand is stochastic and dependent on effort, this essay shows that the benchmark revenue-sharing contract could not coordinate a three-level supply chain consisting of one manufacturer, one distributor, and one retailer. By assuming that the retailer himself bears the effort cost, coordination is achieved by implementing revenue-sharing contract based on rebate and penalty policy in one transaction or two transactions of three-level supply chain, and the former is a special case of the latter. When the disruptions induce the changes of the market demand, the revenue-sharing contract could not coordinate the supply chain. To deal with the problem, this essay introduces two forms of improved revenue-sharing contracts which have antidisruption ability. The model of improved revenue-sharing contract is optimized when the market demand is in the additive form with effort dependent demand. Formulas are given to calculate the optimal contract parameters. Finally, this essay demonstrates the accuracy of the model of improved revenue-sharing contract with the help of numerical examples.

scholarly journals Three-Level Supply Chain Coordination under Disruptions Based on Revenue-Sharing Contract with Price Dependent Demand

2014 ◽  
Vol 2014 ◽  
pp. 1-11 ◽  
Author(s):  
Qinghua Pang ◽  
Yuer Chen ◽  
Yulu Hu
Keyword(s):  
Supply Chain ◽  
Supply Chain Coordination ◽  
Revenue Sharing ◽  
Optimal Contract ◽  
Market Demand ◽  
Revenue Sharing Contract ◽  
Normal Environment ◽  
Contract Form ◽  
Additive Form ◽  
Dependent Demand

Considering the market demand is stochastic and dependent on price, this paper shows that the revenue-sharing contract could coordinate a three-level supply chain consisting of one manufacturer, one distributor, and one retailer under normal environment. However, the original revenue-sharing contract cannot coordinate the supply chain under disruptions in circumstances of certain incidents leading to significant changes in market demand and causing additional deviation costs. To solve the problem, this essay introduces two improved forms of revenue-sharing contract: a mixed contract form based on a quantity discount policy and a pure form, which are characterized by antidisruption ability. The model of improved revenue-sharing contract is optimized when the market demand is in the additive form or in the multiplicative form with price dependent demand. Formulas are given to calculate the optimal contract parameters. Finally, this essay demonstrates the accuracy of the model of improved revenue-sharing contract with the help of numerical examples.

scholarly journals Supply Chain Coordination under Inventory Inaccuracy with RFID Technology

2018 ◽  
Vol 2018 ◽  
pp. 1-13 ◽  
Author(s):  
Quansheng Lei ◽  
Yin Zhang ◽  
Lingyu Zhou
Keyword(s):  
Supply Chain ◽  
Stackelberg Game ◽  
Supply Chain Coordination ◽  
Revenue Sharing ◽  
Coordination Mechanism ◽  
Economic Viability ◽  
Rfid Technology ◽  
Numerical Examples ◽  
Revenue Sharing Contract ◽  
Dependent Demand

In this paper we consider a two-echelon supply chain under price-dependent demand market and we use RFID to eliminate the effect of inventory inaccuracy. Models are built to evaluate the economic viability and coordination conditions. We analyze two scenarios in which the supply chain is defined, the integrated one and the decentralized one, respectively. For the integrated, we compare the different supply chain revenue with and without RFID technology and then determine the optimal inventory decisions. For the decentralized, we mainly focus on the coordination mechanism by revenue sharing contract under Stackelberg game. By seeking appropriate contract parameters, the supply chain can finally be coordinated while all partners are better off. Furthermore, numerical examples are given to verify our proposition.

scholarly journals Coordinating Three-Level Supply Chain by Revenue-Sharing Contract with Sales Effort Dependent Demand

2014 ◽  
Vol 2014 ◽  
pp. 1-10 ◽  
Author(s):  
Qinghua Pang ◽  
Yuer Chen ◽  
Yulu Hu
Keyword(s):  
Supply Chain ◽  
Numerical Experiments ◽  
Supply Chain Coordination ◽  
Revenue Sharing ◽  
Optimal Contract ◽  
Improve Performance ◽  
Quantity Discount ◽  
Revenue Sharing Contract ◽  
The Impact ◽  
Dependent Demand

Revenue-sharing contract is a kind of mechanism to improve performance or to achieve perfect coordination of supply chain. Considering a three-level supply chain consisting of a manufacturer, a distributor, and a retailer who faces a stochastic and sales effort dependent demand, the paper analyzes the impact of sales effort on supply chain coordination and expounds the reasons why traditional revenue-sharing contract cannot coordinate supply chain in this condition. Given three cases: only the retailer bears the sales effort cost, only the manufacturer bears the sales effort cost, and the retailer bears the sales effort cost with the manufacturer, the paper proposes an improved revenue-sharing contract based on quantity discount policy to coordinate the supply chain. It illustrates that improved revenue sharing contract can coordinate supply chain by implementing it in one transaction or two transactions of three-level supply chain. The model of improved revenue-sharing contract is optimized, respectively, by addition form and multiplication form with sales effort dependent demand. Formulas are given to determine the optimal contract parameters. Finally, numerical experiments are given to test the accuracy of the model of improved revenue-sharing contract.

scholarly journals Supply Chain Coordination under Stock- and Price-Dependent Selling Rates under Declining Market

2012 ◽  
Vol 2012 ◽  
pp. 1-14 ◽  
Author(s):  
Subrata Saha ◽  
Sambhu Das ◽  
Manjusri Basu
Keyword(s):  
Supply Chain ◽  
Supply Chain Coordination ◽  
Revenue Sharing ◽  
Stackelberg Games ◽  
Numerical Examples ◽  
Revenue Sharing Contract ◽  
Demand Rate ◽  
Time Price

We explore coordination issues of a two-echelon supply chain, consisting of a distributor and a retailer. The effect of revenue-sharing contract mechanism is examined under stock-time-price-sensitive demand rate. First, we investigate relationships between distributor and retailer under noncooperative distributor-Stackelberg games. Then we establish analytically that revenue sharing contact is able to coordinate the system and leads to the win-win outcomes. Finally, numerical examples are presented to compare results between the different models.

scholarly journals Three-level supply chain coordination of fresh agricultural products in the Internet of Things

2017 ◽  
Vol 117 (9) ◽  
pp. 1842-1865 ◽  
Author(s):  
Bo Yan ◽  
Xiao-hua Wu ◽  
Bing Ye ◽  
Yong-wang Zhang
Keyword(s):  
Supply Chain ◽  
Internet Of Things ◽  
Supply Chain Coordination ◽  
Revenue Sharing ◽  
Agricultural Product ◽  
The Internet ◽  
Market Demand ◽  
Content Type ◽  
Revenue Sharing Contract ◽  
The Internet Of Things

Purpose The Internet of Things (IoT) is used in the fresh agricultural product (FAP) supply chain, which can be coordinated through a revenue-sharing contract. The purpose of this paper is to make the three-level supply chain coordinate in IoT by considering the influence of FAP on market demand and costs of controlling freshness on the road. Design/methodology/approach A three-level FAP supply chain that comprises a manufacturer, distributor, and retailer in IoT is regarded as the research object. This study improves the revenue-sharing contract, determines the optimal solution when the supply chain achieves maximum profit in three types of decision-making situations, and develops the profit distribution model based on the improved revenue-sharing contract to coordinate the supply chain. Findings The improved revenue-sharing contract can coordinate the FAP supply chain that comprises a manufacturer, distributor, and retailer in IoT, as well as benefit all enterprises in the supply chain. Practical implications Resource utilization rate can be improved after coordinating the entire supply chain. Moreover, loss in the circulation process is reduced, and the circulation efficiency of FAPs is improved because of the application of IoT. The validity of the model is verified through a case analysis. Originality/value This study is different from other research in terms of the combination of supply chain coordination, FAPs, and radio frequency identification application in IoT.

scholarly journals Coordinating Contracts for Two-Stage Fashion Supply Chain with Risk-Averse Retailer and Price-Dependent Demand

2013 ◽  
Vol 2013 ◽  
pp. 1-12 ◽  
Author(s):  
Minli Xu ◽  
Qiao Wang ◽  
Linhan Ouyang
Keyword(s):  
Supply Chain ◽  
Supply Chain Coordination ◽  
Revenue Sharing ◽  
Channel Coordination ◽  
Risk Averse ◽  
Revenue Sharing Contract ◽  
Risk Neutral ◽  
Mean Variance ◽  
Variance Approach ◽  
Dependent Demand

When the demand is sensitive to retail price, revenue sharing contract and two-part tariff contract have been shown to be able to coordinate supply chains with risk neutral agents. We extend the previous studies to consider a risk-averse retailer in a two-echelon fashion supply chain. Based on the classic mean-variance approach in finance, the issue of channel coordination in a fashion supply chain with risk-averse retailer and price-dependent demand is investigated. We propose both single contracts and joint contracts to achieve supply chain coordination. We find that the coordinating revenue sharing contract and two-part tariff contract in the supply chain with risk neutral agents are still useful to coordinate the supply chain taking into account the degree of risk aversion of fashion retailer, whereas a more complex sales rebate and penalty (SRP) contract fails to do so. When using combined contracts to coordinate the supply chain, we demonstrate that only revenue sharing with two-part tariff contract can coordinate the fashion supply chain. The optimal conditions for contract parameters to achieve channel coordination are determined. Numerical analysis is presented to supplement the results and more insights are gained.

scholarly journals Assessing the coordinated revenue-sharing contract of China’s farmer-supermarket direct-purchase model

2021 ◽  
pp. 1-16
Author(s):  
Peng Liang ◽  
Melat Sima ◽  
Yu Huang ◽  
Xiaoyu Sun
Keyword(s):  
Supply Chain ◽  
Risk Sharing ◽  
Supply Chain Coordination ◽  
Revenue Sharing ◽  
Market Demand ◽  
Long Term Stability ◽  
Revenue Sharing Contract ◽  
Promotional Efforts

China began connecting farmers directly with supermarkets 10 years ago, when they were at a disadvantage and forced to sell products at low prices, as unstable cooperation among supply chain participants led to inequitable distribution of revenue. Revenue-sharing contracts offer a risk-sharing approach to ensure supply chain coordination and optimize profit for all. Research on short life cycle products with revenue-sharing contracts assume stable prices or investigate the effects of revenue-sharing contracts on supply chain coordination. This study introduced a revenue-sharing contract model into a ‘farmer-supermarket direct-purchase’ supply chain, considering price fluctuation and retail promotional efforts, stochastic market demand, among other factors. Revenue-sharing contracts achieved long-term stability in supply chain coordination, all participants obtained more profits, and the size of revenue-sharing parameter depends on the position and bargaining power of all participants. A case study on Tianhong supermarket and Nanxia farmer cooperative verified these findings, eliciting practical implications for professionals and policymakers.

scholarly journals A Coordinating Strategy for Biofuel Supply Chain under Disturbance Using Revenue Sharing Contract Approach

2018 ◽  
Vol 30 (2) ◽  
pp. 195-204 ◽  
Author(s):  
Nana Geng ◽  
Yong Zhang ◽  
Yixiang Sun
Keyword(s):  
Supply Chain ◽  
Alternative Energy ◽  
Supply Chain Coordination ◽  
Revenue Sharing ◽  
Optimal Order ◽  
Market Demand ◽  
Coordination Problem ◽  
Coordination Strategy ◽  
Revenue Sharing Contract ◽  
Biofuel Supply Chain

Biofuel is considered to be an important alternative energy in the future transportation. Its development is supported by the rest of the world. However, biofuel industry development is still very slow. From the previous research it is known that the supply chain coordination and other problems need to be solved to promote the supply chain ability. This paper studies biodiesel supply chain coordination problem from the view of disturbance management. It gives a disturbed coordination strategy which contains the optimal order quantity and the contract parameters. This paper has then verified the disturbed coordination strategy through using the actual data of Jiangsu Yueda Kate New Energy Co. Ltd. The result shows that when the market demand and the recovery cost are simultaneously disturbed, the coordination can make the biodiesel supply chain robust and the new strategy under the revenue sharing contract is better than the original one.

Supply Chain Coordination through a Revenue-Sharing Contract with Two Kinds of Fuzzy Demand

2017 ◽  
Vol 10 (4) ◽  
pp. 1-17 ◽  
Author(s):  
Junyan Wang ◽  
Yuan Ren
Keyword(s):  
Supply Chain ◽  
Supply Chain Coordination ◽  
Fuzzy Variable ◽  
Revenue Sharing ◽  
Market Demand ◽  
Uncertain Environments ◽  
Revenue Sharing Contract ◽  
Fuzzy Demand ◽  
The One

Revenue-sharing contract is used in many industries. However, it is hard to guarantee that the retailer report the sales truly to the supplier. In fact, the retailer has both incentive and opportunity to underreport the sales to reduce the sharing revenue to the supplier. What the supplier should do when meeting with the opportunistic retailer(s)? This paper studies a kind of opportunistic phenomenon in a supply chain in which a supplier sells to a retailer under a revenue-sharing contract. Two settings are discussed. The first one is that the retailer does not, or cannot underreport the sales to the supplier to share when the supplier design a strict auditing mechanism under which no lies allowed. The second one is that the retailer can underreport the sales to the supplier to share under another soft auditing mechanism. Due to the uncertainty of market demand, it is characterized by a fuzzy variable. Interestingly, we find that the supplier's profit is higher in the second setting than the one in the first setting. We hope that the conclusion drawn in the paper can provide a new viewpoint to help the supplier to solve the problem when meeting with an opportunistic retailer in a supply chain under a revenue-sharing contract in uncertain environments.

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