Double marginalization and coordination in the supply chain with uncertain supply

Coordination in a Single-Retailer Two-Supplier Supply Chain under Random Demand and Random Supply with Disruption

“…Lin et al [38] proposed an insurance contract under which the supplier shares the risk of overstock and understock with the retailer, and showed that the insurance contract can coordinate the supply chain with a newsvendor-type product. Li et al [39] explored a generalized supply chain model and showed the double marginalization effect in the supply chain under supply uncertainty. When the demand is deterministic, a wholesale price contract and a shortage penalty contract is developed to coordinate the supply chain.…”

Incentives to improve the service level in a random yield supply chain: The role of bonus contracts

“…However, there are several other types of yield variability, such as all-or-nothing, guaranteed-minimum-yield, binomial and additive form, etc. Li et al, 2013;Inderfurth and Vogelgesang, 2013). Therefore, it is interesting to study whether our main results still hold under different ways of modeling yield variability.…”

“…Wang (2009) compares the role of traditional and vendor-managed-inventory arrangements between a manufacturer and a distributor in mitigating the random yield risk. Li et al (2013) explore the double marginalization 2 In the random yield supply chain, the definition of the unit bonus contract between the manufacturer and the retailer is similar to the over-production risk sharing contract, which is investigated by Inderfurth and Clemens (2014) and He and Zhang (2008). It is also similar to the additional marginal payment, which is considered by Sohoni et al (2011).…”

Innovative supply chain optimization models with multiple uncertainty factors

“…Recently, it has been discovered that double marginalization may create big challenges for the supply chain under multiple uncertainties, e.g., under both supply and demand risks, compared to the traditional supply chain (Li et al 2013). Also the required coordination contracts are much more complex under these multiple-uncertainty scenarios (Guler and Bilgic 2009;Ai et al 2012;Li et al 2013). Supply chain contracting is a useful measure to mitigate supply chain risk and to achieve Pareto improvement.…”