Research And Analysis, Based On Game Theory Of The Supply Chain With A Competitor

With the development of world economy, the acceleration of globalization and the advancement of science and technology, the supply chain management has attracted more and more attention from both the academic and manufactory circles. Based on this condition, this paper analyzes the classical two-level supply chain problem which contains one distributor and two retailers in a single period cycle, and then further discusses the problem from two respects, pricing decision and inventory decision. We also investigate the two retailers games under various scenarios in order to see the retails'best response curve and the existence of Nash Equilibrium.The main contents in this paper are as followings:●Firstly, we summarize the theories on the supply chain and supply chain management, analy-sis the application of game theory in supply chain management, and then review the literature of both domestic and aboard in this area.●Secondly, we analyze the various conditions of demand functions. Then, at the assumption that demand function is linear, we investigate the different pricing strategy for the two retailers. Based on the introduction of utility function of comparing competitor's profit, the optimal pricing strategy curves of retailers are analyzed under different parameters. And then, we further discuss the existence and uniqueness of Nash Equilibrium considering the competitor's condition.●Thirdly, we analyze the inventory games among the two retailers. Here, we consider non-transfer and transfer of demand among retailers. Here, we analyze the games when the capacity of distributor is indefinite.The innovation of this paper is as followings:1. First is the research model. Based on previous research results, we further extend the model and introduce a new utility function at the condition of retailers' revenue, so as to compare the profit between itself and its competitors.2. Second is the research method. This paper starts from the demand function and analyze the optimal decision strategy on pricing and ordering inventory for the two retailers and the Nash Equilibrium under different parameters respectively.3. Third is the summarization of the combination of games theory and supply chain and the proposal of further research.