Coordinated Contract Design for Two-Level Supply Chain Considering Supplier's Quality Level

DOI

10.2991/icemse-16.2016.3How to use a DOI?

Keywords

Supply chain contract, game theory, supplier's quality, channel coordination

Abstract

This paper investigated procurement contracts in a two-level supply chain system which includes a supplier and a manufacturer who sells the supplier's product to the final market, and the market demand function was given by linear demand function in quality and price. We designed three supply chain contract models employing game theory: optimal contracts in centralized control setting, profit margin contract and profit sharing contract in decentralized control setting. The study shows that the profit sharing contract could achieve supply chain channel coordination in decentralized setting, besides, the retail price is decreasing function with supplier's quality level, and meanwhile the order quantity and the expected profit are increasing functions with supplier's quality level.

Copyright

© 2016, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Pin Zhuang
PY  - 2016/12
DA  - 2016/12
TI  - Coordinated Contract Design for Two-Level Supply Chain Considering Supplier's Quality Level
BT  - Proceedings of the 2016 International Conference on Education, Management Science and Economics
PB  - Atlantis Press
SP  - 10
EP  - 13
SN  - 2352-5398
UR  - https://doi.org/10.2991/icemse-16.2016.3
DO  - 10.2991/icemse-16.2016.3
ID  - Zhuang2016/12
ER  -