Research On The Coordination Of Supply Chain For The Ameliorating Items Based On Price Discount Contracts

The British supply chain management expert Martin Christopher pointed out that twenty-first Century is no longer a competition between enterprise and enterprise,but between supply chain and supply chain.Under the background of the new economic era,if each supply chain is regarded as an economic decision-making subject,then the goal pursued should be the maximization of the overall interests of the supply chain system rather than the benefit maximization of a single enterprise in the supply chain.However,due to some factors such as self-interest or information asymmetry,the members of the supply chain often deviate from the overall goal of maximizing the benefits of the supply chain system.Therefore,it is necessary to coordinate the decision-making behavior of supply chain members with appropriate mechanism.Price discount contracts is a common means of supply chain coordination,which is widely used in practice.The theory results of supply chain coordination using price discount contracts are also rich,and the objects of supply chain coordination are mainly common goods and deteriorating items.However,in commodity markets,there is also a category of goods,which will cause increases in quantity,weight or quality over time in their holdings when the impact of demand is not taken into account.As a result,the economic value or utility of the goods is enhanced.We call this category ameliorating items.While the supply chain of common goods and deteriorating items are highly concerned,the supply chain of ameliorating items has not attracted the attention that should be paid by the academic circles.Considering the ameliorating characteristics of the ameliorating items during holding periods,this paper studies the vertical and horizontal coordination problems of the ameliorating items supply chain under different assumptions.The specific research work includes the following parts.The first part,the research of supply chain coordination for ameliorating items under the permitting shortages.Firstly,the vertical coordination of the improved supply chain under the permitted shortage is discussed.By taking a two-echelon supply chain of ameliorating items consisting of a singer retailer and a singer supplier as an object,assuming that the retailer is allowed to run out of stock and all of the stock is delayed and replenished,the cost functions of supply chain in the decentralized making-decision and the centralized making-decision were established separately.Through the comparison,the minimum cost per unit time of supply chain of ameliorating items in the centralized making-decision was lower than in the decentralized making-decision,but the retailer’s minimum cost per unit time was increased.For compensating the cost loss of the retailer in the centralized making-decision,the quantity discount contract is used to coordinate the supply chain of ameliorating items.The coordination results show that when the supplier provides the optimal quantity discount contract,the minimum cost per unit time of supply chain of ameliorating items can be reduced without increasing the minimum cost per unit time of the retailer.Secondly,the horizontal coordination of the improved supply chain under the permitted shortage is discussed.By taking a two-echelon supply chain of ameliorating items consisting of a retailer and multiple suppliers as an object,assuming that the retailers are allowed to run out of stock and all of the stock is delayed and replenished,the minimum total cost function per unit time of multiple retailers in the independent replenishment and in the joint replenishment was established separately.The sufficient and necessary conditions for joint replenishment to be superior to independent replenishment are derived.The problem of cost allocation of joint replenishment is transformed into a multi-person cooperative game model.The basic principle of cost allocation is given.The numerical demonstration of total cost allocation of purchasing alliance in joint replenishment is presented by using Shapely value method,and the results of four different cost allocation algorithms are compared.The second part,the research of supply chain coordination for ameliorating items under the non-instantaneous replenishment.Firstly,the vertical coordination of the improved supply chain under the non-instantaneous replenishment is discussed.By taking a two-echelon supply chain of ameliorating items consisting of a retailer and a supplier as an object,assuming that the supplier continues to replenish at a certain replenishment rate,the cost functions of supply chain in the decentralized making-decision and the centralized making-decision were established separately.By comparing the cost function,it is found that the centralized making-decision is superior to the decentralized making-decision,but in the centralized making-decision,the retailer can not restock according to his best ordering period.In order to realize the minimum cost per unit time of supply chain of ameliorating items,the quantity discount contract is used to coordinate.The coordination results show that when the supplier provides the optimal quantity discount contract,it can not only maintain the minimum cost of the retailer in decentralized making-decision,but also achieve the overall optimization of the supply chain system of ameliorating items.Secondly,the horizontal coordination of the improved supply chain under the non-instantaneous replenishment is discussed.By taking a two-echelon supply chain of ameliorating items consisting of a retailer and multiple suppliers as an object,assuming that the supplier provides the same replenishment rate for each retailer,the minimum total cost function per unit time of multiple retailers in the independent replenishment and in the joint replenishment was established separately.The sufficient and necessary conditions for joint replenishment to be superior to independent replenishment are derived.In this chapter,the problem of cost allocation of joint replenishment is transformed into a multi-person cooperative game model,and the basic principle of cost allocation is given.The Minimum Nucleolus Method is used to allocate the total cost of purchasing alliance in joint replenishment.The third part,the research of supply chain coordination for ameliorating items under the trade credit.Firstly,the vertical coordination of the improved supply chain under the trade credit is discussed.By taking a two-echelon supply chain of ameliorating items consisting of a retailer and a supplier as an object,the supplier provides the trade credit and direct price discount as coordination mechanism.The profit level and coordination of the members of supply chain of ameliorating items under the decentralized was discussed in this chapter.The profit level of the retailer and the supplier and the profit increment of the maximum profit per unit time for ameliorating items’ supply chain after the coordination.At the same time,profit sharing mechanism is designed to distribute the profit increment after the coordination,so as to achieve the Pareto improvement of the profit level of each member.Secondly,the horizontal coordination of the improved supply chain under the trade credit is discussed.By taking a two-echelon supply chain of ameliorating items consisting of a retailer and multiple suppliers as an object,assuming that the supplier provides permissible delay in payments as a means of credit sales.The maximum total profit function per unit time for multiple retailers in independent purchasing and joint purchasing were built up respectively,including that the optimal ordering period is shorter and longer than delay payment period.A necessary and sufficient condition for joint replenishment to be dominant was obtained.The cost allocation of joint replenishment problem was constructed as the game of joint replenishment of ameliorating items.After giving some basic properties of the game,the article designed a profit sharing method based on the core of the game.