• Industrial Engineering and Management Systems
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• v.12 no.3
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• pp.224-233
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• 2013

In supply chain management, the supply contract can induce collaboration and coordination among the supply chain members in order to optimize supply chain performance. Numerous supply contracts have been examined; however, some difficulties related to the application of these contracts still occur. One of the solutions is to apply the composite supply contract which can assist in the supply chain coordination. This research examines the composite contract of the revenue sharing and quantity flexibility contracts in a two-stage supply chain, which comprises a retailer and a supplier. In this research, a mathematical model of the composite contract is developed; then, the applicability of the proposed composite contract is examined by investigating its capability in terms of supply chain coordination and profit allocation. In the numerical experiments, the composite revenue sharing-quantity flexibility contract showed that it is superior to both component contracts in terms of supply chain coordination and profit allocation among supply chain members.

• Journal of Information Processing Systems
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• v.18 no.2
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• pp.208-222
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• 2022

Through the analysis of the coordination mechanism of the supply chain system of China's automobile manufacturing industry, the factors affecting the supply subsystem, the manufacturing subsystem, the sales subsystem, and the consumption subsystem are sorted out, the supply chain coordination index system based on the influence factor of four subsystems is established. The evaluation models of the coordination degree in the subsystem of the supply chain, the coordination degree among the subsystems, and the comprehensive coordination degree are established by using the efficiency coefficient method and the collaborative entropy method. Experimental results verify the accuracy of the evaluation model using the empirical analysis of the collaborative evaluation index data of China's automobile manufacturing industry from 2000 to 2019. The supply chain synergy of automobile manufacturing industry was low from 2001 to 2005, and it increased to a certain extent from 2006 to 2008 with a small growth rate from 0.10 to 0.15. From 2009 to 2013, the supply chain synergy of automobile manufacturing industry increased rapidly from 0.24 to 0.49, and it also increased rapidly but fluctuated from 2014 to 2019, first rising from 0.68 to 0.84 then dropping to 0.71. These results provide reference for the development of China's automobile manufacturing supply chain system and scientific decision-making basis for the formulation of relevant policies of the automobile manufacturing industry.

• Industrial Engineering and Management Systems
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• v.8 no.4
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• pp.213-220
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• 2009

A revenue sharing contract is one of the mechanisms that coordinate decision makers in a decentralized supply chain toward the consensual goal. The transfer prices between different echelons in the supply chain influence the total supply chain profits. The study aims to explore various transfer pricing heuristics on the supply chain coordination in terms of the supply chain profits and their interactions with the revenue sharing rate. A model is proposed for formulating the collaborative production and distribution planning in a decentralized supply chain with the revenue sharing mechanism. Experiment results indicate that the transfer price and the revenue sharing rate affect significantly the coordination. Among the studied pricing heuristics, the variable-cost pricing method led to the best SC profits. Raising the revenue sharing rate reduced the SC profits no matter what heuristics were employed. Furthermore, the experiments provide us clues for finding the optimal transfer price for the supply chain.

• Journal of the Korean Operations Research and Management Science Society
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• v.30 no.3
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• pp.17-39
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• 2005

The coordination of a three-level supply chain consisting of a supplier, a retailer, and a discount outlet (DCO) is studied here. We assume that the product is sold in two consecutive periods a Normal Sales Period (NSP) and a subsequent Clearance Salvage Period (CSP). A benchmark case is studied Initially in which the supply chain is coordinated by a s1n91e agent. Thus, the supplier the retailer, and the discount outlet design a common system that allows centralized decision making about stocking quantities, markdown time schedules, and policies on disposing of leftovers to deliver the greatest possible expected supply chain profit. Next, we consider a decentralized supply chain. Here, decisions are made without coordination. The objective is to maximize an individual party's expected profits. The focus of the study is on the following questions: what factors make the coordination an effective approach for the supply chain? How do we coordinate the supply chain so as to maximize the supply chain Joint expected profit? These and other related study issues are explored in this paper.

• Korean System Dynamics Review
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• v.13 no.1
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• pp.81-112
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• 2012

This study investigate the impact of supply chain contracts on supply chain performance. This study employed Price adjustment contract(PAC) and Quantity adjustment contract(QAC) as two main types of a vertical coordination mechanism. We simulate different types of coordination mechanisms with various degrees of demand uncertainties and several capacity tightness scenarios. This study shows that PAC and QAC significantly enhance the supply chain profits and fill rates suggesting that supply chain performance can be improved by implementing a proper coordination mechanism depends on the level of a capacity tightness and demand uncertainty.

• The Journal of Industrial Distribution & Business
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• v.13 no.3
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• pp.1-12
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• 2022

Purpose: The revenue sharing contract has been widely used in industries, and its ability to coordinate the supply chain system has been studied by numerous researchers. By reviewing the representative studies on the revenue sharing contract, this study intends to analyze the key features of this coordinating contract and identify its potential to be a more advanced coordination program than the original contract. Research design, data, and methodology: This study reviews past studies on the revenue sharing contract. The selected studies are investigated with a focus on how this contract is described to realize the supply chain coordination and the key issues that they address. Results: The literature review reveals that the revenue sharing contract requires standardized details about what and how to share. This study also finds additional issues that need to be addressed by researchers to improve this coordinating contract. Conclusions: Future researchers are advised to unify the detailed contents of the revenue sharing contract to confirm that it successfully coordinates the supply chain system. In addition, this study proposes key research issues that would enhance the role of revenue sharing contract as a supply chain coordination program.

• Management Science and Financial Engineering
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• v.13 no.2
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• pp.117-139
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• 2007

This paper contributes by incorporating works addressing supply chain coordination and investing in setup reduction program. Consider a two-echelon, EOQ-like inventory system consisting of a supplier and a buyer. We assume that both the supplier and the buyer can invest in setup cost reduction programs in order to benefit from small order sizes. However, the costs of investing in setup cost reduction programs are different for the two parties, leading to mismatches in individually optimal setup costs and order cycle times. We propose a supply chain coordination contract that makes use of quantity discount as an incentive transfer scheme for supply chain coordination.

• Journal of Information Processing Systems
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• v.19 no.4
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• pp.513-526
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• 2023

Supply chain coordination plays a critical role in improving the enterprise performance and the competitive advantage of fresh e-commerce. This study explores the coordination problem of a two-echelon fresh produce e-commerce supply chain comprising a fresh e-commerce enterprise and a fresh supplier in a novel framework. In this framework, the fresh e-commerce sells fresh produce and provides promotion effort; meanwhile, the fresh supplier deliveries fresh produce and provides freshness-keeping effort. Specifically, the optimal decisions under centralized and decentralized decision-making are compared, and it is found that centralized decision-making is more profitable. Based on this work, we created a cost-sharing and revenue-sharing combination contract. This study demonstrates that this contract effectively coordinates the supply chain and makes both parties achieve Pareto optimization when the parameters meet certain conditions. Finally, the feasibility and validity of the contract are presented through a numerical example.

• Journal of the Korean Operations Research and Management Science Society
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• v.31 no.1
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• pp.25-36
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• 2006

Consider a supply chain in which a vendor supplies a product to a buyer. We assume that the buyer's and vendor's inventory cost structures are different, resulting in differences in inventory order/delivery cycle times. Here, if one party insists on its individually optimal order/delivery quantity, the other party will suffer from mismatches in cycle times. Under this scenario, coordination contracts that make use of either a Net Term/Two parts Term Trade Credit or a Quantity Discount are designed to align individually optimal order Quantities. We compare and analyze the perform ances of these contracts. The focus of the comparison is the ability of contracts to generate a lower cost for the supply chain. We show that a Trade Credit policy can be effectively used to coordinate a supply chain. In many cases it will result in a lower supply chain cost compared to that achieved by using a Quantitative Discount policy.

• Journal of Korean Society for Quality Management
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• v.46 no.4
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• pp.959-972
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• 2018

Purpose: This study developed a simulation model that incorporates the uncertainty of demand and yield to obtain optimized results for supply chain coordination within environmental constraints. The objective of this study is to examine whether yield management for perishable products can achieve the goal of supply chain coordination between a single buyer and a single supplier under a variety of environmental conditions. Methods: We investigated the efficiency of a revenue-sharing contract and a wholesale price contract by considering demand and yield uncertainty, profit maximizing ratio, and success ratio. The implications for environmental variation were derived through a comparative analysis between the wholesale price contract and the revenue-sharing contract. We performed Monte Carlo simulations to give us the results of an optimized supply chain within the environments defined by the experimental factors and parameters. Results: We found that a revised revenue-sharing contracting model was more efficient than the wholesale price contract model and allowed all members of the supply chain to achieve higher profits. First, as the demand variation (${\sigma}$) increased, the profit of the total supply chain increased. Second, as the revenue-sharing ratio (${\Phi}$) increased, the profits of the manufacturer gradually decreased, while the profits of the retailer gradually increased, and this change was linear. Third, as the quality of yield increased, the profits of suppliers appear to increased. At last, success rate was expressed as the profit increased in the revenue-sharing contract compared to the profit increase in the wholesale price contract. Conclusion: The managerial implications of the simulation findings are: (1) a strategic approach to demand and yield uncertainty helps in efficient resource utilization and improved supply chain performance, (2) a revenue-sharing contract amplifies the effect of yield uncertainty, and (3) revised revenue-sharing contracts fetch more profits for both buyers and suppliers in the supply chain.