Research On Game Of Ordering Strategy In Supply Chain Based On Short Life Cycle Products

Technological advances and demand diversifications make the replacement of product continue to accelerate, and continuously shorten product life cycle. While facing fierce competition in the market, success of every enterprise largely depends on the overall competitiveness of the supply chain, which relies on its quick response to the varieties. In current context, there are more stresses on cooperation between upstream and downstream firms. However, in order to pursue their interests, conflict is inevitable. Due to the nature of strong uncertainty and quick response of short life cycle product supply chain, these issues seem more prominent. Therefore, using game theory to study the decision-making problems in it could be a lot help to understand the nature of supply chain optimization, and it would be also of important theoretical and practical significance to raise the efficiency of short life cycle product supply chain effectively and enhance competitiveness of the supply chain.Under the background of a short life cycle product, this paper discusses the ordering decision models, in a two-tier supply chain environment formed by suppliers and retailers, when the retailers and suppliers were respectively at the core of the supply chain. As supply chain leading enterprise changes, the dominant position of nodes enterprise will use this advantage to push some unfavorable factors and the potential loss push to other, therefore decision variables of each side will be significant changes in the ordering process. When suppliers are dominant, vendors stimulate retailers to advance orders through certain incentives. By doing so, it has prompted the retailer's active participation, under the premise of protection of their own interests. When retailers dominate, it means retailers will control the price under a relatively low level in the ordering through competitive pressure. But while facing directly to consumer groups, retailers are special status. They can put signal to help increase sales to eliminate the backlog of suppliers. In order to reduce the uncertainty of their own, retailers often compress lead time into a very short period of time. Especially for short life cycle products, time is profit, when suppliers and retailers want to reduce their uncertainty and potential losses through the leverage of time, their interests often conflict. This paper, by using game theory, motivation theory, system optimization modeling and decision theory, analyzes the different decisions of the main stakeholders in the supply chain under different conditions, and compares the different distribution of benefits.