Decision Game And Revenue Coordination Mechanism In VMI Supply Chains With TPL

With the increased holding cost of multi-echelon supply chains in process ofproduction outsourcing, more and more companies start to implement vendor-managedinventory (VMI); meanwhile, the growth of third-party logistics (TPL) induces manysuppliers to outsource the operation of VMI to third-party logistics provider (TPLP). In adecentralized VMI supply chain, the decision game on benefit exists among the playersand, with the increased number of the players, becomes more complicated. Departing fromthis, this dissertation concentrates on the decision game and revenue-sharing mechanismdesign in VMI supply chains with the TPLP who makes decision independently or not.More specifically, the innovative research works are summarized as follows:The sequential decision game and Nash bargaining game in a VMI supply chain withsingle supplier are modeled, and the unique equilibrium of each game is concluded. Byanalyzing the Nash bargaining game framework, the dissertation uncovers that thesupplier’s revenue may decrease with her bargaining power; there exists optimalbargaining power for the supplier to maximize her profit. Meanwhile, the optimalbargaining power for the supplier is impacted by her decision on whether to incorporatethe TPLP who does not make decision independently.By incorporating the TPLP who makes decision independently, the dissertationstudies the decision game and revenue-sharing mechanisms among the TPLP, singlesupplier and manufacturer in a3-echelon VMI&TPL supply chain, and proposes tworevenue-sharing mechanisms respectively based on decentralized decision-making and theplayers’ contributions on supply chain. The first mechanism is divided into twomechanisms with two players and with three players separately; the research discoversthat the supply chain efficiency is higher in the mechanism with three players than in theone with two players, and either the TPLP or the manufacturer prefers the cooperationbetween the others than that between herself and another player. Moreover, the unequaldistribution of revenue may arise in the first mechanism, but can be avoided in the second.The model of a decision game in an assembly VMI supply chain is proposed in thecontext of assembling production. The research results show that the supply chain efficiency is higher in the assembly supply chain than in the supply chain with singlesupplier if the players’ decisions are decentralized. Then, the revenue-sharing mechanismsrespectively based on decentralized decision-making and the players’ contributions onsupply chain are proposed. It is shown that given the equal profits under differentmechanisms for all players, the bargaining power space for them exhibits similarcharacteristics; the supplier’s shared proportion of the added profit needs to be bounded inthe former mechanism, especially when her cost advantage on the alternative supplysource is reduced.The dissertation studies the decision game and revenue-sharing mechanisms in anassembly VMI&TPL supply chain with TPLP, N suppliers and single manufacturer. Inthe decentralized supply chain, the TPLP either chooses the service price for each kind ofthe components or a total price for all kinds of components. It is uncovered by comparisonthat the players’ profits make no difference for these two pricing modes, and the loss rateof supply chain efficiency increases with the number of the suppliers. Under therevenue-sharing mechanism based on the players’ contributions on supply chain, theminimal bargaining power value for a player to participate in such mechanism decreaseswith the number of the suppliers. In the revenue-sharing mechanism based ondecentralized decision-making, the TPLP chooses service price that is lower than her cost,and the sum of suppliers’ prices equals the sum of their costs. Moreover, the twomechanisms can be mutually converted under certain conditions on the players’ bargainingpowers.