Coordinating a supply chain with effort and price dependent stochastic demand

He, Yong; Zhao, Xuan; Zhao, Lindu; He, Jun

doi:10.1016/j.apm.2008.08.016

Cited by 175 publications

(91 citation statements)

References 14 publications

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“…Denote ( * , * ) as the optimal joint decision of the retailer. By substituting (8) into the retailer's profit function, we have…”

Section: Retailer's Decisionmentioning

confidence: 99%

“…Following this stream of research, in this paper we consider endogenous retail price in a single-period supply chain and study the decisions and performance of the supply chain with a buy-back contract. Buy-back contracts are commonly used in many industries such as fashion apparel, publishing, and cosmetics [8], and the retailers in such industries need to decide the retail price before the selling season.…”

Section: Introductionmentioning

confidence: 99%

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Optimal Decisions in a Single-Period Supply Chain with Price-Sensitive Random Demand under a Buy-Back Contract

Wang

Choi

2014

Mathematical Problems in Engineering

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This paper studies a single-period supply chain with a buy-back contract under a Stackelberg game model, in which the supplier (leader) decides on the wholesale price, and the retailer (follower) responds to determine the retail price and the order quantity. We analytically investigate the decentralized retailer's optimal decision. Our results demonstrate that the retailer has a unique optimal simultaneous decision on the retail price and the order quantity, under a mild restriction on the demand distribution. Moreover, as it can be shown that the decentralized supply chain facing price-sensitive random demand cannot be coordinated with buy-back contract, we propose a scheme for the system to achieve Pareto-improvement. Theoretical analysis suggests that there exists a unique Pareto-equilibrium for the supply chain. In particular, when the Pareto-equilibrium is reached, the supply chain is coordinated. Numerical experiments confirm our results.

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“…Denote ( * , * ) as the optimal joint decision of the retailer. By substituting (8) into the retailer's profit function, we have…”

Section: Retailer's Decisionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Optimal Decisions in a Single-Period Supply Chain with Price-Sensitive Random Demand under a Buy-Back Contract

Wang

Choi

2014

Mathematical Problems in Engineering

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“…He et al (2009) investigate a supply chain with stochastic demand that depends on both sales effort and price and prove that a buyback policy cannot achieve coordination. Zhao et al (2014) investigate the buyback contract with a stochastic price-dependent demand.…”

Section: Buyback Contractsmentioning

confidence: 99%

Pareto Improving Supply Chain Coordination Under a Money-Back Guarantee Service Program

2017

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Abstract. Money-back guarantee (MBG) is a well-known service offered by many retailers. Under the MBG policy, a purchased item by a consumer can be returned for a full refund. In this paper, we explore a supply chain (SC) system comprising of one retailer, which offers the money-back guarantee policy and faces a stochastic demand. With a given supply contract offered by the supplier, the retailer makes decisions on the order quantity and the market coverage of the money-back guarantee service. With reference to real-world practices, we examine three models, namely, (1) the traditional wholesale pricing model without the buyback contract, (2) the model with a buyback contract (between the supplier and the retailer) for unsold items, and (3) a dual-buyback (DB) contract model for both unsold and consumer returned items. We find that using the buyback contract alone for unsold items cannot achieve Pareto improving supply chain coordination, whereas the DB contract can. Numerical findings also indicate that the DB contract can lead to an expansion of the money-back guarantee service program to cover more customers. This paper's findings support the implementation of the DB contract, which is commonly seen in the industry, for efficient supply chain management in the presence of the money-back guarantee service program.

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“…When the market demand is affected by the marketing effort of downstream agent -which is unverifiable by the chain -a coordinating contract should induce the supply chain's optimal level of marketing effort. He et al (2009) explore coordinating contracts for a twotier, two-node topology with both price and marketing effort sensitive market demand. Another factor that could affect the market demand is the stock level.…”

Section: Supply Chain Environmentmentioning

confidence: 99%

Coordinating Contracts in SCM: A Review of Methods and Literature

Hezarkhani

Kubiak

2010

dmms

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Abstract. Supply chain coordination through contracts has been a burgeoning area of research in recent years. In spite of rapid development of research, there are only a few structured analyses of assumptions, methods, and applicability of insights in this field. The aim of this paper is to provide a systematic overview of coordinating contracts in supply chain through highlighting the main concepts, assumptions, methods, and present the state-of-theart research in this field.

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Coordinating a supply chain with effort and price dependent stochastic demand

Cited by 175 publications

References 14 publications

Optimal Decisions in a Single-Period Supply Chain with Price-Sensitive Random Demand under a Buy-Back Contract

Optimal Decisions in a Single-Period Supply Chain with Price-Sensitive Random Demand under a Buy-Back Contract

Pareto Improving Supply Chain Coordination Under a Money-Back Guarantee Service Program

Coordinating Contracts in SCM: A Review of Methods and Literature

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