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Growing Science » Decision Science Letters » Supply chain coordination via a two-part tariff contract with price and sales effort dependent demand

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Decision Science Letters

ISSN 1929-5812 (Online) - ISSN 1929-5804 (Print)
Quarterly Publication
Volume 4 Issue 1 pp. 27-34 , 2015

Supply chain coordination via a two-part tariff contract with price and sales effort dependent demand Pages 27-34 Right click to download the paper Download PDF

Authors: Qinqin Li, Zhiying Liu

Keywords: Channel coordination, Contract, Game theory, Sales effort, Two-part tariff

Abstract: This paper studies the channel coordination between a supplier and a retailer with price and sales effort dependent demand. By means of game theory, we analyze price and sales effort decisions of the centralized supply chain. Then we consider three different contracts under decentralized model, i.e., wholesale price contract, cost-sharing contract and a two-part tariff contract, in which the supplier offers a contract comprising a wholesale price and a lump-sum fee to the retailer to coordinate the supply chain. Finally, we analyze the results to compare the equilibrium decisions under different contract scenarios. Our results show that both the wholesale price contract and the cost-sharing contract cannot coordinate the supply chain while the two-part tariff contract can effectively coordinate the supply chain.

How to cite this paper
Li, Q & Liu, Z. (2015). Supply chain coordination via a two-part tariff contract with price and sales effort dependent demand.Decision Science Letters , 4(1), 27-34.

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Journal: Decision Science Letters | Year: 2015 | Volume: 4 | Issue: 1 | Views: 4488 | Reviews: 0

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