Research On A Retailer’s Purchasing Strategy And Incentive Strategy Under Supply Disruption Risk

The development of economic globalization promotes the further specialization of supply chain and the further globalization of the distribution of supply chain nodes.The time dimension and the space dimension of supply chain are greatly expanded.At the same time,many uncontrollable factors and frequent natural disasters in every link of the supply chain bring huge risks to the supply chain,reduce the reliability of the supply chain,and increase the risk of the supply chain.In the more common supply chain risk,supply chain interruption is widely concerned because of its high frequency and large loss.A large number of cases have proved that the occurrence of supply disruption will lead to a lack of production resources in the downstream enterprises of the supply chain,resulting in production stoppage,if the disruption is serious,it will also cause production disconnection between the upstream and downstream enterprises,resulting in serious economic losses.Facing the supply risk,it is of great practical and theoretical significance to study the supplier’s supply reliability and the retailer’s purchase decision-making.This dissertation reviews the literature on supply disruption risk,and finds that the existing literature still has the following shortcomings: First,most of the literature assumes that the supplier’s supply reliability is exogenous;In fact,the supplier’s supply reliability can be adjusted by improving the supplier’s supply process,and the decision-making problem of supply chain members under the condition of endogenous supply reliability level is worth studying.The existing literature does not deal with the decision-making problem of supply chain members when the production cost of products is affected by the supply reliability level under the endogenous supply reliability level.In order to improve the supplier’s power to improve the reliability of supply,it is worth studying that retailers adopt different incentive strategies.Firstly,the dissertation analyzes the retailer’s purchasing strategy when the supplier’s supply reliability level is endogenous.The competition among modern enterprises is the competition among supply chain efficiency to a great extent,and the supply risk is an important factor that affects the realization of high efficiency of supply chain.The research of this dissertation is that the supply chain is composed of a retailer and a supplier,and the retailer,as the leader of Stackelberg,takes the expectation of the retailer and the supplier as the target,respectively,and applies the Game Theory and the economic principle to solve the retailer’s procurement strategy under the supplier’s endogenous supply reliability level.The results show that:(1)the cost coefficient of improving the reliability level of the supplier has an effect on the retailer’s purchasing strategy.(2)when there is an emergency purchase,the retail price of the product does not affect the retailer’s purchase strategy,but only its expected profit.(3)under four different constraints,retailers and suppliers have the optimal procurement strategy and the optimal level of supply reliability.It is found that the supplier’s reliability level and the retailer’s expected profit decrease slowly with the increase of the cost coefficient of improving the reliability level.Secondly,the dissertation analyzes the retailer’s purchasing decision-making and the supplier’s reliability level when the supplier’s production cost is affected by the supplier’s reliability level.In this dissertation,the Stackelberg model is established under the influence of the supplier’s production cost,and Game Theory is used to solve the optimal retailer’s purchasing strategy and the supplier’s optimal reliability level.The results show that:(1)the retailer can achieve the expected profit maximization only by adjusting the order quantity or the purchase price according to the input cost sensitivity coefficient to improve the supply reliability.(2)the retailer’s optimal purchase strategy is influenced by the reduction of unit variable cost,in which the optimal order quantity increases and the optimal purchase price decreases.(3)when the cost coefficient of the supply reliability level is less than a certain threshold,the supplier’s optimal supply reliability level can achieve reliable supply;when the cost coefficient of supply reliability level is higher than this threshold and the emergency purchase price is higher,the supplier’s optimal supply reliability level can not achieve reliable supply.Finally,the retailer’s optimal procurement strategy and the supplier’s optimal supply reliability level are analyzed when the retailer subsidizes the supplier’s supply reliability cost.In order to encourage suppliers to improve the level of supply reliability,retailers adopt two incentive strategies: unit wholesale price subsidy or supply reliability input-cost ratio subsidy.The results of the unit wholesale price subsidy model and the input-to-cost ratio subsidy model of supply reliability show that:(1)when the supplier supply is not reliable,the retailer can improve the supplier’s reliability level by increasing the order quantity or increasing the unit wholesale price subsidy.(2)when the supplier’s supply is not reliable,the supplier’s supply reliability cost and the supply chain member’s optimal profit are proportional to the market demand and proportional to the retail price,but they are inversely proportional to the cost sensitivity coefficient of the supply reliability level.(3)when the supply is completely reliable,the retailer’s optimal order quantity and the optimal unit wholesale price subsidy(the cost subsidy proportion of the optimal supply reliability level)are all affected by the market demand.In addition,the results of the two subsidy incentive models are different in that:(1)when the retailer’s supply is unreliable and the wholesale price is high(higher than a certain threshold,the thresholds in the two models are different),the retailer only needs to adjust the order quantity to encourage the supplier to improve the supply reliability level;when the wholesale price is low(below this threshold,the thresholds in the two models are different),retailers need to adjust both order quantity and unit wholesale price subsidy to encourage suppliers to improve the level of supply reliability.