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This paper addresses the optimal decisions and channel coordination issues in a green supply chain composed of a socially responsible manufacturer and a fair-mined retailer, where the manufacturer invests in advanced facilities/technologies to improve green quality of products, and the retailer exerts marketing effort to enhance market demand. We develop supply chain models under three scenarios: centralized system, wholesale price (WP) contract without fairness concerns, and WP contract with fairness concerns. Our results show that the retailer’s fairness behavior further causes a benefit for herself, while the manufacturer and the total supply chain to suffer. Moreover, a revenue-cost-sharing (RCS) contract is introduced to coordinate supply chain . We prove that a win-win outcome is reachable, and the RCS contract is applicable in practice.

This paper considers the supply chain composed of altruistic retailers and selfish manufacturers under risk aversion. We use the mean variance (MV) method to construct two types of behavior models. One is a two-stage supply chain model with a single manufacturer and a single retailer, and the other is a competitive supply chain model with two retailers and two manufacturers. We discuss the decision-making problems under manufacturer Stackelberg (MS) game and retailer Stackelberg (RS) game, respectively. We analyze the role of risk aversion and power structure. Results show that the more risk aversion manufacturers are, the lower the emission reduction levels are. It also find that the prices increase with power shift from retailers to manufacturers. Finally, we point out that the competing can help the firms earn more benefits via numerical studies.

This paper considers a low carbon supply chain consisting of a single manufacturer and a single retailer under the condition that the demand is uncertain. We first establish three games, including manufacturer Stackelberg (MS), retailer Stackelberg (RS) and Nash according to the different power structure of the firms. We then determine that the equilibrium stocking factors, emission reduction levels, wholesale prices and retail prices for the three models, respectively. After that, we demonstrate the effects of power structure. Results show that when the power shifts from the retailer to the manufacturer, the stocking factor decreases, whereas the wholesale price increases. Finally, we discuss the impacts of the random demand. We find that the expected profits of the firms, the emission reduction levels and the retail prices are increasing with respect to the market potential and low-carbon sensitivity coefficient, respectively. Meanwhile, they decrease with respect to the price sensitivity coefficient.

In this paper, a combined contract composed of option and cost sharing is proposed to investigate coordination and risk‐sharing issues of the supply chain consisting of a dominant retailer and a risk‐averse manufacturer. Demand faced by the retailer is stochastic in nature and dependent on marketing effort. We adopt the conditional value‐at‐risk (CVaR) criterion to model risk aversion of the manufacturer, and derive the optimal strategy for each member with a Stackelberg game in which the retailer acts as the leader. It is verified that the combined contract can coordinate the supply chain and achieve Pareto‐improvement. Moreover, the dominant retailer can allocate the system‐wide profit arbitrarily only by option price in the premise of coordination. It is worth mentioning that coordination of the supply chain is reachable only when the manufacturer is low in risk aversion, and the manufacturer's risk aversion is a significant element for contract design and profit allocation. [ABSTRACT FROM AUTHOR]

This paper addresses a vendor-managed inventory (VMI) supply chain with a loss-averse manufacturer and a risk-neutral retailer. Market demand faced by the retailer is stochastic and dependent on product quality level and marketing effort level. We propose a combined contract composed of option and cost-sharing to investigate coordination and profit allocation issues of the supply chain. To model loss aversion of the manufacturer, we employ multiple mental accounts and apply the utility function to upside and downside potentials of manufacturer's production decision separately. We derive the optimal strategy for each member with a Stackelberg game in which the retailer acts as the leader. It is proved that both coordination of the supply chain and Pareto-improvement can be achieved synchronously by the combined contract. In the premise of coordination, the system-wide profit can be allocated arbitrarily only by option price. Through negotiation, the retailer and the manufacturer just need to confirm an appropriate option price to obtain that neither of them becomes worse off. We also find that the manufacturer's loss aversion is a significant element for contract design and profit allocation, and the manufacturer could benefit from its own loss aversion behavior under certain condition. [ABSTRACT FROM AUTHOR]