Research On Performance Improvement Of Supply Chain Within3PL When Demand Is Influenced By Logistics Service Level

In recent years, with the development of the economy globalization and the marketrequirement diversified, the competition environment of the enterprise has changedmuch. Enterprise is fronting with severe challenge in responding consumer’srequirement quickly and effectively. The competition between enterprises graduallyevolved to the competition between the supply chains which involve the enterprises.The logistics which company needs become more enormous and complicated, so manycompanies give its logistics business to the third-part logistics. On the one hand,3PL’shigh tone and specialized service can lower the logistics cost of the company. On theother hand, it can also improve the customer satisfaction of the company. Supply chainalliance can improve each company’s competitive strength, but they are also faced withthe problem of interest conflict. So some incentive mechanisms and contractmechanisms are needed to coordinate the interest conflict, this is a very significant fieldin the research of supply chain management.This paper combines relevant theory of supply chain coordination, researches theperformance improvement of supply chain within manufacturer,3PL and retailer whendemand is influenced by logistics. It reads as follows:First, based on the truth that logistics service level influences consumers’ demand,a supply chain decision model which manufacturer is a leader is developed. Then thebackward induction in dynamic game was used to analyse the manufacturer,3PL andretailer’s decision for relevant parameter in decentralized decision model andcentralized decision model. The conclusion implied that in decentralized decision model,if the retailer pays the logistics service expenses, they can all gain the most profit； thetotal revenue in centralized decision model is greater than that in decentralized decisionmodel, and the logistics service level improve, the retail price of the product lower.Then cost sharing and revenue sharing contract are used to research this problem ofsupply chain performance improvement. In order to incentive3PL to improve thelogistics service level, we consider that manufacturer and retailer undertake a part of thecost what used to improve the logistics service level. Through analyzing thedecision-making of the manufacturer, retailer and3PL in cost sharing contract, we findwhen the contract parameters are between a particular extent, each one can get moreprofit than in decentralized decision model. In revenue sharing contract, the manufacturer and3PL offer lower wholesale price and logistics service price to retailer,but acquire some revenue as pay back. The analysis result indicates proper parameter inthe revenue sharing contract can stimulate the manufacture,3PL and retailer to make ajoint effort and get more profit than at decentralized decision.At last, relevant numerical cases were used to analyse the previous conclusions.And revenue sharing contract is better than cost sharing contract.