Quantity Discounts Under Asymmetric Demand Information

As the main management mode of modern enterprise, supply chain management becomes a hot topic in the enterprise management theoretical study and practical application. But a inconsistent supply chain will bring some inefficient effect, such as double marginalization, bullwhip effect and so on. So more and more scholars pay attention to the supply chain coordination mechanism research.. The key to design effective contract mechanism is to coordinate the supply chain and maximize own benefit, which is an important way to improve supply chain efficiency. Because quantity discount can effectively reduce the transaction cost, and realize the profit distribution flexibly, so quantity discount is widely used, as a low cost effective coordination mechanism in practice by the widespread application. But there are many problems in most theory research about quantity discount. First of all, most scholars are for the whole quantity discount, while researches on incremental discount are correspondingly deficient. Secondly, the research of incremental discount model is mostly limited to information symmetry, but the truth is that suppliers and retailers are in the information on one another, namely, they do not share what they know, such as asymmetric demand information, etc. Therefore, the research on quantity discount under asymmetric information has important theoretic and practical significance.In this paper, the current domestic and international researches on quantity discount and supply chain contracts are summarized at first. Secondly, combining with entrust-agency theory and storage theory, it establish four quantity discount models under asymmetric information which achieves two supply chain coordination goals, then using the software MATLAB, numerical simulation are given to analysis the influence of quantity discount in different situations, and carries on the analysis results:two quantity discount models are useful for coordinating the supply chain, but the influence is different under different goals, and it is also different for same goal; what’s more, the influence decreases with suppliers’ uncertainties of demand information.