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This paper aims to find operational decisions and financing strategies in a closed-loop supply chain (CLSC) consisting of a financially constrained manufacturer and a retailer. Based on a benchmark...

We consider a supply chain in which a manufacturer with random yield sells the product through a retailer, where the overflowed order of the retailer may be fulfilled by the manufacturer’s outsourcing product. The inherent uncertainties include demand uncertainty, yield uncertainty, and outsourcing information asymmetry. Two contingent outsourcing contracts are studied based on whether the delivery lead-time quotation is adopted or not. We study how the two outsourcing contracts affect supply chain decision-makings and profits by introducing a backup supplier with private cost information. By employing backward induction technique, we obtain a closed-form analytical solution for backup supplier selection and ordering decisions. The manufacturer can outsource the retailer’s overflowed order to a backup supplier when the actual yield is low. In the presence of multi-dimensional uncertainties, there exists robustness for both outsourcing contracts. Depending on both the yield and the backup supplier’s cost type, the manufacturer makes one of three choices to outsource production: choosing both types of the backup supplier, choosing only the low-cost backup supplier, or choosing neither. The outsourcing quantity may be a part or all of the retailer’s overflowed order. Unlike the contract without constraint on lead-time, the quotation of the delivery lead-time endows the manufacturer with the ability of revealing the true cost information, thus it can improve the manufacturer’s outsourcing profit. However, the quotation of delivery lead-time may make the whole supply chain less efficient.

In this paper, we develop three supply chain game models, i.e., the basic model, the single trade credit model, and the trade credit and revenue sharing collaboration model. Conditional value-at-risk (CVaR) criterion is used as the measure of risk assessment in these models. We analyze the optimal decisions in the centralized and decentralized situations, respectively, and verify that single trade credit cannot coordinate the supply chain. However, the collaboration contract can coordinate the supply chain. Furthermore, this paper explores the influence of risk-aversion factor, trade credit period, revenue sharing coefficient, and other parameters on the optimal decisions and studies the feasible range of Pareto improvement in the collaborative model. In numerical experiments, the results show that the decisions and profits of both the manufacturer and the retailer reply on the degree of the risk aversion, the trade credit period, and the revenue sharing coefficient. The collaborative contract effectively improves supply chain performance and achieves a ‘win-win’ situation for the supply chain members. In addition, we also consider two extensions for our research. One extension shows that the collaborative contract of trade credit and buyback can also coordinate the supply chain in a certain range. The other extension considers the optimal decision of a risk-averse manufacturer with CVaR.

We develop an inventory model for perishable products with a two-period shelf-life. The demand during a stock out in either period is treated as lost sales. Besides the initial regular order, the manager also has an opportunity to adjust the mid-cycle inventory with either expedited order or returns. An expedited order plan allows the manager to place an emergency order if the mid-cycle leftover inventory is low, while a returns plan offers the manager a chance to return some units within the validity period to suppliers if the leftover inventory is high. We show that both adjustment plans have their own thresholds, which exhibit a similar policy to that in the classical newsvendor model. Due to the dynamics of inventory, we investigate how the regular order is affected by each adjustment plan. Our findings indicate that the expedited order plan has a better performance in controlling the wastage risk, but it results in a higher shortage risk than the returns plan. Considering the respective advantages of the two plans, we show the existence of a new plan that is the combination of the two and justify the motivation for the manager to use it in the perishable inventory management.

In recent years, the market economy has been booming, and the demand of consumers has begun to become diversified. Consumers’ preferences for products, the sensitivity of product prices, and other factors can often affect the market demand and also make enterprises realize the importance of consumer preferences. The decision-making model of the supply chain with consumer preference composed of a retailer and a third-party presale platform is established, and we analyze the implementation of a single presale model, a single spot-sale model, and decision-making models under the “presale and sale” mode. The equilibrium strategy of centralized decision and decentralized decision under the mode of “presale and sale” is compared, and the influence of the proportion of informed consumers and the exogenous variables of cross-period discount on supply chain decision is further analyzed. The coordination strategy of the decentralized decision supply chain under the mode of “presale and sale” is put forward, and the coordinated operation among supply chain members is realized. The results show that compared with other sales models, the “presale and spot-sale” model is more beneficial to the profit of the supply chain.

This paper investigates a dual-channel supply chain, where one national brand manufacturer has both online and retail channels. The retailer is assumed to sell the national brand as well as his store brand to customers. The following five scenarios are considered: Centralized case, Stackelberg-manufacturer (SM) game, Stackelberg-retailer (SR) game, Nash-manufacturer (NM) game and Nash-retailer (NR) game. The paper derives the conditions under which the supply chain members would like to participate in cooperative advertising. The results show that in the Stackelberg games, the leader in Stackelberg game will reduce its investment in cooperative advertising when it gets a lower marginal profit from the cooperative advertising; In addition, the dual-channel supply chain can get a higher profit if it is dominated by the member whose marginal profit from cooperative advertising is higher. In the Nash games, in order to increase the whole supply chain's profit, the member who has a higher marginal profit in the cooperative advertising should give up the decision power on cost-sharing rate voluntarily. In addition, if there exists a leader in the supply chain, the cooperative advertising will be higher. Furthermore, the introduction of store brand will trigger the manufacturer's antipathy for the low profit.

This paper develops option contracts in a supplier-retailer agricultural supply chain where the market demand depends on sales effort. First, we examine a benchmark case of integrated supply chain with the loss rate. Second, we introduce three coordinating option contracts led by the supplier to reduce the retailer's risk, where the call option contract can reduce the shortage risk, the put option contract can reduce the inventory risk and the bidirectional option contract can reduce the bilateral risk. We find that both the optimal initial order quantity and the optimal option quantity increase with the sales effort and the option price will balance the influence of the loss rate on supply chain coordination. Furthermore, the bidirectional option price is the highest while its option quantity is the least, and the put option initial order quantity is the highest. Third, we also consider an option contract led by the retailer to reduce the supplier's wholesale risk. Among the above four option contracts, we find that the option quantity led by the retailer is the highest. Finally, the numerical examples present the impact of the parameters on the optimal decisions, and provide practical managerial insights to reduce the different risk in the agricultural supply chain.

We investigate pricing decisions and information value in two competing supply chains, each consisting of one manufacturer and one retailer. Both retailers are engaged in Bertrand retail competition and are endowed with the private information on the disrupted demand. Three information sharing scenarios have been considered, i.e. , information sharing in both chains, information sharing in only one chain, and information sharing in neither chain. For each information scenario, there always exists robustness for each manufacturer’s production plan. That is, when the disrupted amount of the market demand is sufficiently small, the manufacturer’s production plan or the retailer’s order quantity will be unchanged. Meanwhile, we also study the information value by comparing these three information scenarios, and find that the information value not only works in one chain directly, but also does in the competing chain indirectly. Through comparative analysis, we find that the retailer is reluctant to share his private information on the disrupted demand with his partner because of the fear of information leakage. Meanwhile, the performance of the whole chain may become worse off if the information of disrupted demand is shared in this chain.

We study pricing and replenishment policies for a supply chain with multiple competing retailers.Both retail-competition and retail-cooperation models for a supply chain are considered.Retail cooperation is not stable and replenishment decision is largely affected by game scenario.A Groves wholesale price contract is designed to coordinate the supply chain.Coordination mechanism includes discount, competitive impact, and revenue regulator components. This paper develops game models for a two-echelon supply chain with one supplier and multiple competing retailers. We study the pricing decision and the replenishment policy for each member under both the decentralized channel and the centralized channel, and examine the impacts of retail behaviors on them. Compared with the centralized operation, the decentralized operation with linear wholesale price obviously inflates the holding cost for each retailer, which results in the inefficiency for the whole channel. For the decentralized system, both retail-competition and retail-cooperation models are considered. The comparative analysis illustrates how the retail pricing and replenishment decisions are affected by the retail behaviors. We find that the retail cooperation is not stable since each self-interested retailer has an incentive to lower his retail price unilaterally. Finally, in order to improve the performance of the channel and each member, a Groves wholesale price contract is designed to achieve the perfect coordination between the supplier and the retailers. Meanwhile, this coordination model can also be used in the case of a supply chain with independent retailers.

In this paper, we develop a two-period inventory model of perishable products with considering the random demand disruption. Faced with the random demand disruption, the firm has two order opportunities: the initial order at the beginning of selling season (i.e., Period 1) is intended to learn the real information of the disrupted demand. When the information of disruption is realized, the firm places the second order, and also decides how many unsold units should be carried into the rest of selling season (i.e., Period 2). The firm may offer two products of different perceived quality in Period 2, and therefore it must trade-off between the quantity of carry-over units and the quantity of young units when the carry-over units cannibalize the sales of young units. Meanwhile, there is both price competition and substitutability between young and old units. We find that the quantity of young units ordered in Period 2 decreases with the quality of units ordered in Period 1, while the pricing of young units is independent of the quality level of old units. However, both the surplus inventory level and the pricing of old units monotonically increase with their quality. We also investigate the influence of two demand disruption scenarios on the optimal order quantity and the optimal pricing when considering different quality situations. We find that in the continuous random disruption scenario, the information value of disruption to the firm is only related to the disruption mean, while in the discrete random disruption scenario, it is related to both unit purchase cost of young units and the disruption levels.

We develop a game model for a supply chain consisting of one e-commerce platform and multiple retailers. The platform with operational data of each retail store can effectively help retailers select marketable products and then improve their operational efficiency. We first investigate the motivation of retailers in accepting the platform digital empowerment (PDE) and joining the platform. We find that the retailer should join the platform and choose PDE only when the sales effort cost coefficient is high and the effect of sales effort on demand is weak. Second, we investigate the influence of the number of retailers on the platform network effect and find that the more retailers on the platform, the more profits the retailers and the e-commerce platform will make. Besides, the retailers’ sales efforts and the PDE level will increase. Third, we study the PDE decisions under the unconstrained and decentralized control system (DC), the decentralized control system with revenue sharing contract (RS) and the decentralized control system with profit sharing contract (PS), respectively. We find that the platform’s profit in PS is the highest among these systems if the sales effort cost coefficient is high. Furthermore, for these systems, the PDE level under DC is always the highest if the effort cost is low; otherwise, the PDE level under PS is the highest. In addition, the sales effort under DC is always the highest if PDE is employed, that is, nether RS nor PS can effectively promote the retailer’s sales effort.

In this paper, a closed-loop supply chain consisting of a manufacturer, a retailer and a third-party remanufacturer responsible for collecting used products and remanufacturing is constructed. Considering the quality level of remanufactured products, four kinds of closed-loop supply chain alliance structure models are constructed. The optimal equilibrium decisions of these four models are compared and analyzed. The optimal decisions of the models are verified by numerical analysis. Furthermore, the impacts of the quality of remanufactured products and the decision influence of the third-party remanufacturer in the alliance on the remanufacturer’s decision are further analyzed. The results show that remanufactured products are competitive with new products, and the improvement of the remanufactured product quality will reduce the market demand of new products. The equilibrium decision of the closed-loop supply chain is affected by the alliance behavior of members in the closed-loop supply chain and the quality level of remanufactured products. The higher the decision concentration of the closed-loop supply chain is, the more favorable the supply chain is; the higher the remanufacturing quality level is, the more favorable the supply chain is, and the alliance decision of the third-party remanufacturer is affected by the quality level of remanufactured products and the decision-making influence of the third-party remanufacturer in the alliance structure. We find that the improvement of the concentration degree of closed-loop supply chain decision can benefit the supply chain by improving the remanufacturing quality level, which has direct effect on the alliance decision of the third-party remanufacturer. In most cases, the choice of the alliance is the dominant decision of the third-party remanufacturer.

This paper studies inventory models for a perishable product with lost sales under the first-in-first-out inventory issuing rule. The lifetime of perishable product is equal to two selling periods. At the beginning of the first period, the manager decides an order quantity, and at the end of the period he has a chance to reorder or return some items. Therefore, we develop two kinds of inventory models, i.e., one is the inventory model with reorder policy and the other is the inventory model with return policy. We find that each inventory model is determined by an inventory threshold. A high inventory threshold is for the return policy, and a low inventory threshold is for the reorder policy. The reorder policy will be used only when the surplus inventory at the end of the first period is less than the low threshold, while the reorder policy will be used only when the surplus inventory at the end of the first period is higher than the high threshold. We also show that each inventory policy has its merit and demerit.

This paper develops the game models of two symmetric supply chains, each consisting of one manufacturer and one retailer, while both retailers compete in the market with a linear function. The disclosure mechanism is designed when the information of the disrupted demand is asymmetric between supply side and retail side. We first study the model with the full information as a benchmark to explore the effect of asymmetric information on the system. In the case, each manufacturer maximizes her profit while the downstream retailer only obtains the reservation profit. For the case of asymmetric information, each manufacturer can obtain the real information of the disrupted demand by using a menu of contract bundles. For each information structure, there are always robust regions for each manufacturer’s original trading quantity scheme. That is, when the disrupted amount of the demand is sufficiently small, the trading quantity will be unchanged. However, some special measures, e.g., the higher unit wholesale price, should be taken to prevent the retailer from deviating the trading quantity scheme. The high-disruption retailer gets the higher profit due to the information rent. Compared with a single supply chain, Cournot competition results in the less retail price and the lower performance for the whole system.