Contract Choice Game And Decision Model In Competing Supply Chains

With the quickening of economic globalization and market competition becomes more and more intense, it is impossible for any enterprises to deal with challenges by themselves. As a result, the competition form is evolving from the competition among firms to the competition among supply chains based on collaborative and win-win principles. Therefore, it is necessary for us to research the decision models and methods of competing supply chains, and it has theoretical significance and practical value to the supply chain management.Taking two supply chains as research objects, we focus on researching the decision models and methods of competing supply chains from marketing and operation angle. On the one hand, we try to expand the knowledge of supply chain management horizontally, i.e., from single supply chain to two supply chains, from two separate supply chains to two overlapping supply chains. On the other hand, we try to expand the knowledge of supply chain management vertically, i.e., from price competition to non-price competition, from decisions of marketing level to decisions of operation level. The main work and innovations of the dissertation are summarized as follows.(1) Research on decision model of price competition under Stackelberg game between supply chains. Taking two supply chains as research object, each containing one manufacturer and one retailer, the problems of complete information and incomplete information Stackelberg game are discussed when two supply chains adopt four various supply chain structures, including the structures of Decentralization-Decentralization, Decentralization- Integration, Integration-Decentralization, Integration-Integration. It is found that, contrast to the complete information static game, under the complete information Stackelberg game, integration is the dominate strategy for the leader supply chain. As for the follower supply chain, choosing decentralization or integration, it is depended on the degree of products substitutability and the action of the leader supply chain. And, the equilibrium strategies are depend on the forecasting veracity of the leader supply chain and the degree of products substitutability under the incomplete information Stackelberg game.(2) Research on equilibrium strategies of supply chains with price and service competition. Assuming two non-cooperative games of different power structures between the two manufacturers and two retailers, i.e., Manufacturer Stacklberg and Vertical Nash games, we study the effect of the competition degree between supply chains and the bargaining power between manufacturers and retailers on the equilibrium strategies of price and service. It can be found that, counter to the earlier literature, under the competition between supply chains, no matter the manufacturers act as Stacklberg leaders or the manufacturers and retailers hold the equal bargaining power, the two supply chains can obtain much more profit by providing customer service if the service competition degree and the coefficient of service cost is low. This is right for the manufacturers and the whole supply chains. However, the retailers are always better off under offering service than no service. In addition, in contrast to the Manufacturer Stacklberg scenario, the customers are better off when the manufacturers and retailers hold the equal bargaining power. The numerical study shows that if one of supply chains has cost advantage over the competitors, he can hold the competitive advantage by offering service.(3) Equilibrium strategies of contract choice game between two competing supply chains. Taking two separate supply chains for example, assuming determinate demand and uncertain demand respectively, the models of contract choice game between supply chains are researched. On the one hand, we prove the existence of Nash equilibrium under when both manufacturers choose quantity-discount contracts. On the other hand, we study the effect of the competition degree between supply chains and the bargaining power between manufacturers and retailers on the equilibrium strategies of contract choice games. It can be found that, counter to the earlier literature, as for the competing supply chains, under the manufacturer Stacklberg scenario, the choices of quantity-discount contracts are the Nash equilibrium structure for both manufacturers, moreover, it is the Pareto equilibrium if the degree of competition is low, however, the manufacturers will get into classic prisoner’s dilemma if the degree of competition is high. Under the retailer Stacklberg scenario, the results are reverse. The choices of quantity-discount contracts are the Pareto equilibrium if the degree of competition is high. As for the retailers, no matter the manufacturers act as Stacklberg leaders or the retailers, the retailers are better off under quantity-discount contracts if the degree of competition is high.(4) Equilibrium strategies of contract choice game between two competing overlapping supply chains. On the one hand, assuming the substitution of the two products can be symmetrical and asymmetrical as well, we investigate how the degree of product substitutability affects the equilibrium contract choices. On the other hand, we fully characterize the equilibrium contract choice decisions under different competitive effect at both manufacturer and retailer levels. We find that under the competition at both manufacturer and retailer levels, the manufacturers will transfer to wholesale-price contracts from quantity-discount contracts as the competitive effect at manufacturer level increases, and this effect is stronger as the competitive effect at retailer level increases. As for the retailers, the results are reverse, as the competitive effect at manufacturer level increases, the retailers will transfer to quantity-discount contracts from wholesale-price contracts, and the probability of choosing wholesale-price contracts increases as the competitive effect at retailer level increases.The above research results not only enrich the content of decision models of competing supply chains, but also promote the application rang of the decision models of competing supply chains, and provide more sufficient scientific evidence for decision makers of supply chain management.