Stackelberg Game And Coordination Mechanism On The Supply Chain Procurement With Distribution Controllable Lead Time

With the prevalence of JIT (Just in Time) philosophy in many industries, lead time management becomes an important means to improve performance. In practice, there are various ways of lead time management, such as QR (Quick Response) policy in apparel industry; TBC(Time-Based Competition) strategy in many industries as health care, catering and transportation industries and CPFR(Collaborative Planning, Forecasting and Replenishment) in retailing industry. By shortening lead time, a company can reduce safety stock level and loss caused by stock-out, improve customer service level, and thus increase competitive edge in business. So, many scholars began to focus on the problem of the controllable lead-time.A two-level supply chain involving a supplier and a retailer with controllable lead-time is studied in this thesis. For lack of consideration about the interaction of the supplier and the retailer, lead-time is expressed by the controllable variables of both two parties. Therefore, the optimal lead-time will be derived from their joint decisions. This article mainly contains the following three parts:(1) We develop a periodic review inventory model where the replenishment lead-time is assumed to be dependent on the lot size and the production rate of the supplier. Shortage at the end of the cycle is permitted, and the service level is considered as a decision variation.(2) We propose an (T,R) type of a periodic review inventory model with partial lost-sales to effectively increase investment and to reduce the lost-sales rate. Additional, lead time is composed of a lot size-dependent run time and constant delay times.(3) We consider a inventory system using the order quantity, reorder point, continuous-review (Q,r) policy, in which the lead-time consists of three components:shipping time, setup time and production time. The first lead-time component is determined by the retailer, others are chosen by the supplier. Optimized ordering/production strategy of two parties are obtained.Based on the three aspects, firstly, we establish Stackelberg game models that the supplier and the retailer are dominated respectively in the supply chain as well as integrated inventory models. Different methods are presented according to each mathematical model. Secondly, the impacts on the best decisions and total costs for the supplier and retailer are investigated in the numerical example. Lastly, we propose a supply chain coordination mechanism in the end of each order model.We gain the following conclusion:since the conflicts of interests and the distributed nature of the decision structure, more often than not double marginalization takes place, this may lead to low efficiency in a supply chain. However, the integrated decision usually makes one party better off while making the other worse off. Therefore, a collaborative mechanism is needed to coordinate the supply chain.