The Coordination Research On Seasonal Products Supply Chain Based On The RFID Technology

As the seasonal product suffer a great market demand fluctuation and a lowresidual after the selling season, the impact of the order quantity of retailer on the profitof the supply chain is significant. Demand forecasting inaccuracies are expensive andare prevalent in many industries. Radio Frequency Identification technology has beenpublicized as a promising solution. Many retailers start to push their suppliers to adoptthis technology has a fixed cost and variable cost of implementation, which can causeincentive issues in the supply chain.Regard of the advantage of improving enterprise automation level andaccelerating the speed of logistics and produce, apply RFID technology is regarded asan effective method to compress the lead-time. However, the investment RFIDtechnology will increase the cost of supply chain, and affects the profit of themanufacturer and the retailer. Therefore, it is urgent need to study the decision ofapplying RFID technology.In this paper, a two-level supply chain with one manufacturer and one retailer wasstudied in the condition of the functions of RFID technology in compress lead-timeand on the assumption that the market demand forecast error varies with lead-timebased. Using the newsvendor model, respectively in no-RFID situation and with-RFIDsituation, between centralized supply chain and decentralized supply chain, we discussthe contract condition of RFID technology cost that can improve the profit of supplychain. After retailer using linear bonus strategy can achieve Pareto improvement of thesupply chain actor’s profits. In the end, a numerical example is presented with Matlab2007b to illustrate the conclusion.This study can be used as quantitative and modeling basis by seasonal productmanufacturers in making decision on RFID investment.