Trade credit financing for supply chain coordination under financial challenges:a multi‑leader–follower game approach

This study is designed to solve supply chain inefficiencies caused by some members’financial problems,such as capital shortages and financing restrictions in a stochastic environment.To this end,we have established a supply chain finance framework by designing two novel coordinating contracts based on trade credit financing for different problem settings.These contracts are modeled in the form of multi-leader Stackelberg games that address horizontal and vertical competition in a supply chain consisting of multiple suppliers and a financially constrained manufacturer.However,previous studies in the trade credit literature have addressed only simple vertical competition,that is,seller-buyer competition.To solve the proposed models,two algorithms were developed by combining population-based metaheuristics,the Nash-domination concept,and the Nikaido-Isoda function.The results demonstrate that the proposed supply chain finance framework can eliminate supply chain inefficiencies and make a large profit for suppliers,as well as the financially constrained manufacturer.Furthermore,the results of the contracts’analysis showed that if the manufacturer is required to settle its payments to suppliers before the end of the period,the trade credit contract cannot coordinate the supply chain because of a lack of incentive for suppliers.However,if the manufacturer is allowed to extend its payments to the end of the period,the proposed trade credit financing contract can coordinate the supply chain.Finally,the sensitivity analysis results indicate that the worse the financial status of the manufacturer,the more bargaining power suppliers have in determining the contract parameters for more profit.

Research on telecommunication resale service supply chain coordination with revenue-sharing contract

The competition and cooperation between traditional telecom operators and resale operators in the supply chain are discussed, when the telecom industry developed telecommunication resale service. Supply chain contract is an effective way to coordinate the supply chain. This paper analyzes the revenue-sharing contract between telecom operators and resale operators. The study shows that by setting up a rational revenue-sharing ratio and wholesale price, a revenue-sharing contract can coordinate this supply chain, and telecom operators and resale operators can achieve a 'win-win' solution.

Supply chain coordination mechanisms under asymmetric information with retailer cost disruptions

A two-level supply chain model involving one supplier and one retailer with linear demand is developed, and supply chain coordination mechanisms under asymmetric information （the retailer＇ s cost structure is asymmetric information） are proposed by employing game theory in two scenarios： coordination mechanisms under asymmetric information in a regular scenario （without disruption）; and coordination mechanisms under asymmetric information in an irregular scenario （ with retailer cost disruptions）. It is optimal for the supply chain to maintain the original production plan and to guarantee a steadily running system if variations of retailer costs are sufficiently low and do not exceed an upper bound. This shows that the original production plan has certain robustness under disruptions. Decisions must be re-made if a retailer＇ s cost change is greater and exceeds an upper bound. Impacts of retailer cost disruptions on the order quantity, the retail price, the wholesale price and each party＇ s as well as the system＇ s expected profits are investigated through numerical analyses.

Supply chain coordination with participators' risk bias under buy-back contract

Considering participators' risk bias,which is measured by the method of value at risk,the risk constraints in a two-echelon supply chain coordination under buy-back contract is equal to giving the order of an upper bound.With a risk-averse dominant enterprise(M)and a risk-neutral non-dominant one(R),the coordination which optimizes the supply chain under the risk constraints is achieved by a penalty mechanism L to reduce R's order.With risk-neutral M and risk-averse R,M can motivate R to increase his order by providing a risk subsidy K,and two cases are discussed.If the risk constraints of R cannot satisfy M's participation constraint to offer K,M will prefer to accept R's order to obtain a sub-optimization solution of the supply chain.Or else,with M's K,R's optimal order just coordinates the supply chain,which is equal to the case without risk bias,and in this situation R's risk bias only affects the profit distribution between the participators.

DISRUPTION MANAGEMENT FOR SUPPLY CHAIN COORDINATION WITH EXPONENTIAL DEMAND FUNCTION

The coordination problem of a supply chain comprising one supplier and one retailer under market demand disruption is studied in this article. A novel exponential demand function is adopted, and the penalty cost is introduced explicitly to capture the deviation production cost caused by the market demand disruption. The optimal strategies are obtained for different disruption scale under the centralized mode. For the decentralized mode, it is proved that the supply chain can be fully coordinated by adjusting the price discount policy appropriately when disruption occurs. Furthermore, the authors point out that similar results can be established for more general demand functions that represent different market circumstances if certain assumptions are satisfied.

Supply chain coordination with CCPP for a short-life-cycle product

Supply chain coordination for short-life-cycle products with price-dependent demand is a focus in present operation management and management science fields. This paper considers the supply chain coordination problem for a single-cycle and two-selling-stage short-life-cycle product. Firstly, the inventory model of whole system is depicted with a stochastic dynamics programming. Then, a new combined contract CCPP （combined contract with pending prices） is developed to coordinate the decentralized system, and its validity for channel coordination is proved. Finally, the analysis on system performances is simulated with some examples.

COMPARISONS OF LOW CARBON POLICIES IN SUPPLY CHAIN COORDINATION

This paper investigates the influence of low-carbon policies on channel coordination for a two-echelon supply chain consisting of one supplier and one retailer. Four different models are considered： the basic model, the carbon emission model, the carbon emission trading model and the carbon tax model. We find that the government policy on all carbon emission models is not universal among the firms as well as the customers. The carbon emission trading policy is always better than the carbon emission policy and the carbon tax policy when the allocated carbon emission quotas are greater than the carbon emissions. The carbon emission trading policy is proved to be an effective mechanism which can motivate the supply chain to reduce carbon emissions. Under certain conditions, the supply chain prefers the carbon emission trading policy with higher carbon price to other policies. In the framework of Stackelberg game with the supplier as the leader, for each carbon policy, the paper presents coordination mechanism with the all-unit wholesale quantity discount contract （AWQD）. We analyze and compare the influence of low-carbon policies on channel coordination for the foul＂ low-carbon policies. Numerical experiments are conducted to examine our findings.

Supply Chain Coordination with Sales Effort Effects and Impact of Loss Aversion on Effort Decision

A new supply contract based on sharing the sales profits as well as the cost of effort was devel- oped to coordinate the supply chain with sales effort effects. The contract coordinates the supplier’s actions with voluntary compliance; the contract is symmetric in the sense that both the supplier’s and retailer’s prof- its are linearly correlated and is more easily implemented in some situations. The impact of the retailer’s loss aversion on his effort is investigated based on the contract. After characterizing the retailer’s optimal solutions, this paper demonstrates that contrary to intuition, loss aversion weakens incentives for retailer’s sales effort and the retailer’s optimal effort decreases as the loss aversion increases.

Coordination of Multi-leaders and Multi-followers in Supply Chain of Value-Added Telecom Services

In order to study supply chain of the telecom value-added service,a multi-leaders and multi-followers Stackelberg game model with multiple telecom operators and multiple service providers whose income is composed of information fee division and advertisement was constructed.Then a demonstration was simulated,and the results were compared with the situation of service providers' income only from information fee division.The simulated and compared results indicate that,the enterprises in the supply chain have the nature of pursuing the maximum profits in capital markets;meanwhile,first-mover advantages and some enterprise can get more profits with the information asymmetry.

FROM MANUFACTURING SCHEDULING TO SUPPLY CHAIN COORDINATION:THE CONTROL OF COMPLEXITY AND UNCERTAINTY

With time-based competition and rapid technology advancements, effective manufacturing scheduling and supply chain coordination are critical to quickly respond to changing market conditions. These problems, however, are difficult in view of inherent complexity and various uncertainties involved. Based on a series of results by the authors, decomposition and coordination by using Lagrangian relaxation is identified in this paper as an effective way to control complexity and uncertainty. A manufacturing scheduling problem is first formulated within the job shop context with uncertain order arrivals, processing times, due dates, and part priorities as a separable optimization problem. A solution methodology that combines Lagrangian relaxation, stochastic dynamic programming, and heuristics is developed. Method improvements to effectively solve large problems are also highlighted. To extend manufacturing scheduling within a factory to coordinate autonomic members across chains of suppliers, a decentralized supply chain model is established in the second half of this paper. By relaxing cross-member constraints, the model is decomposed into member-wise subproblems, and a nested optimization structure is developed based on the job shop scheduling results. Coordination is performed through the iterative updating of cross-member prices without accessing other members' private information or intruding their decision-making authorities, either with or without a coordinator. Two examples are presented to demonstrate the effectiveness of the method. Future prospects to overcome problem inseparability and improve computing efficiency are then discussed.

An Improved Inventory Coordination Model in a Multi-stage Multi-customer Supply Chain

To solve the inventory coordination model in a multi-stage, multi-customer supply chain, this paper first analyzes the third model （integer powers of two multipliers at each firm） studied by Moutaz Khouja （2003）, and the authors take a numerical example to prove that the third model is irrational to miss feasible solution. Then this paper puts up a new improved model （integer multiplier at each firm）, and takes the example to prove it gives better results than the integer powers of two multipliers at each firm.

Collaborative supply chain planning under dynamic lot sizing costs with capacity decision

Studies show that supply chain cooperation improves supply chain performance. However, it remains a challenge to develop and implement the realistic supply chain cooperation scheme. We investigate a two-echelon supply chain planning problem with capacity acquisition decision under asymmetric cost and demand information. A simple negotiation-based coordination mechanism is developed to synchronize production/order strategies of a supplier and a buyer. The coordination scheme shows how the supplier and the buyer modify their production and order policy in order to find a joint economic lot sizing plan, which saves the overall supply chain cost. The allocation of the cooperation benefit is determined by negotiation. Due to the complexity of the multiple periods, multiple level supply chain lot sizing with capacity decision, a heuristic algorithm is developed to find coordination solutions. Finally, the results of the numerical study indicate the performance of supply chain coordination scheme.

Financing Strategy of Low-Carbon Supply Chain with Capital Constraint under Cap-and-Trade Regulation

Cap-and-trade regulation provides incentives for manufacturers to reduce carbon emissions,but manufacturers’insufficient capital can disrupt the implementation of low-carbon emission reduction technologies.To alleviate capital constraints,manufacturers can adopt external financing for low-carbon emission reduction investments.This paper studies the independent financing and financing cooperation behavior in a supply chain in which the manufacturer and retailer first implement low-carbon emission reduction technologies and then organize production and sales in accordance with wholesale price contracts.Through comparing the optimal profits and low-carbon emission reduction levels under the independent financing and financing cooperation mode,we come to the following conclusions:(1)Although financing interest increases the cost of the supply chain,manufacturers prefer to invest in reducing carbon emissions rather than buying carbon quotas.(2)When financing independently,a decentralized decision-making mode(MD)is the best choice for manufacturers.(3)In cooperative financing,when the supply chain adopts a decentralized decision-making mode(SD)in which the retailer determines the financing cost-sharing ratio according to their optimal profit,the profits of the supply chain and its members are significantly improved.(4)When manufacturers and retailers adopt a centralized decision-making model(SC)in cooperative financing,they jointly determine the financing cost-sharing ratio and the level of low-carbon emission reduction.If the financing cost-sharing ratio meets a certain threshold range,the profits of manufacturers and retailers achieve Pareto improvement,indicating that this cooperative financing model is effective.

A joint inventory–finance model for coordinating a capital‑constrained supply chain with financing limitations

Faced with economic recession,firms struggle to find ways to stay competitive and maintain market share.Effective coordination of the supply chain can solve this problem,but this may fail if existing capital constraints and financial flows are ignored.This study addresses the challenge by exploiting coordination through joint decision-making on the physical and financial flows of a capital-constrained supply chain.We also consider the capital-constrained member’s financing limitations that lead to lost sales.Two scenarios based on non-coordinated and coordinated structures are modeled in the form of bi-objective optimization problems that simultaneously optimize system costs and service levels.The models are solved using the -constraint method.The results indicate that the non-coordinated model cannot satisfy more than about 50%of the demand due to capital shortage and financing limitations,while the coordinated model can satisfy all of the demand via internal financing.Furthermore,the proposed coordination scheme leads to cost reduction for the members and the total system.To motivate all members to accept the proposed coordination scheme,a cost-sharing mechanism is applied to the coordination procedure.Finally,a sensitivity analysis concerning financial parameters is provided for validating the coordination model.

Pareto Optimal Solution for Supply Contracts with Multiple Suppliers

This paper analyzes an electronic procurement （e-procurement） process between a manufacturer and N-supplier in the e-market. We proof that using the general contract based on auction theory, i. e. the wholesale price contract, would not achieve the coordination of channel composed of the manufacturer and the winning supplier. The paper designs a contract mechanism, i.e. the side payment price-restricted contract based on auction theory, which not only ensures Pareto optimal solutions for both, but also coordinates the supply chain. A numerical experiment is provided to compare the performance of different auction mechanisms and to reinforce key managerial insights generated through analysis.

Smart contract-enabled consortium blockchains for the control of supply chain information distortion

Conflicts between supply chain members emerge because individual strategic actions may not be jointly optimal.Efforts to forecast consumer demand represent a source of conflict.The coordination of forecasts requires a powerful incentive alignment approach.This work proposes a smart contract equipped consortium blockchain system that creates an incentive structure that makes coordination with respect to forecasts economically appealing.Distortions of demand information due to uncoordinated forecasting are captured by a bullwhip measure that factors both forecast error and variance.Cooperation under the system is shown to help minimize this bullwhip measure,thus generating new outcomes for the participants that allow for a higher reward.Under a fixed payout structure,the system achieves credibility of continued cooperation,thus promoting an optimally coordinated equilibrium between the retailer and supplier.Blockchain technology represents a novel information system and consensus formation mechanism that can intermediate the behavior of a supply chain network.

Coordination by Option Contracts in a Retailer-Led Supply Chain with Demand Update

This research examines how to use an option contract to coordinate a retailer-led supply chain where the market information can be updated. Based on Stackelberg game theory, we build a mode with one supplier and one retailer in which the retailer designs contracts to coordinate the supplier＇s production in a two-mode production environment. This focuses on an option contract that consists of two option prices and one exercise price. By theoretical analysis and numerical example, we find that such a contract can coordinate the supplier and retailer to act in the best interest of the channel. The optimal pricing conditions are given as follows： First, option prices should be negatively correlated to the exercise price and should be in a relevant range. Second, the first-period option price should be no greater than the second-period price and should be linearly correlated to the second-period option price when the latter is beyond some threshold. The results show that such option contracts can arbitrarily allocate the extra system profit between the two parties so that each party is in a win-win situation.

COORDINATION OF A FASHION AND TEXTILE SUPPLY CHAIN WITH DEMAND VARIATIONS

Owing to the changing fashion trends and a volatile market situation, demand in fashion and textile （FT） industry is unpredictable and could vary and change completely in a short time, which makes it more difficult to coordinate a FT supply chain. A change in product preference due to fashion trends is the main reason why the demand of FT industry shows more variations than other industries. In this paper, we use a well known contract, the all-unit quantity discount policy （AQDP）, to coordinate a FT supply chain with certain demand, and we further consider it under the demand variations scenario to investigate whether it can still coordinate the supply chain. In detail, before the selling season, an AQDP is provided by the manufacturer to the retailer, and under which the FT supply chain coordination achieved with a certain demand. During the selling season, demand variation is realized after an abrupt changing of fashion trends, therefore, the manufacturer may need to revise the original AQDP to insure the supply chain is still coordinated. Utilizing the mechanism design theory, we prove that： （i） while the traditional AQDP can coordinate the supply chain when no demand variations, it cannot always coordinate the supply chain after the demand variations; （ii） when the AQDP fails, we can use the proposed capacitated linear pricing policy （CLPP） to achieve a new coordination; （iii） a more dominant decision maker, who can set a higher profit goal, is favorable to stabilization of the supply chain system under demand variations. Numerical examples are proposed also to show our results.

SUPPLY CHAIN DECISION-MAKING AND COORDINATION UNDER PRICE-DEPENDENT DEMAND

This paper studies the decision-making and coordination of supply chain （SC） considering the effect of price-dependent demand. By assuming demand decreases as the price increases, we analyse the impacts of the dependence on the SC in three different models： decentralized without coordination, centralized coordination and decentralized with coordination by revenue sharing contract. The existence of the best solution in the different models is proved, and the performance of revenue sharing coordination SC is similar to the centralized one. We find that the more evidently the price affects the demand, the more revenue sharing contract improves the performance of SC. The dependence affects the decision-making and the parameter setting of revenue sharing contract is also found.

Coordination of a Socially Responsible Supply Chain with Cause Marketing Campaigns

This paper explores the coordination problem of a socially responsible supply chain,in which the supplier contributes corporate social responsibility by donating a specific amount of money to a cause marketing and the retailer cares for consumer surplus in addition to its own profit.We consider two donation formats:absolute amount donation and percentage of profit donation.For each donation format,the optimal solutions for the centralized and decentralized decisions are derived,and the effects of system parameters on the optimal decisions and other outcome variables are investigated.Moreover,a two-part tariff contract and a quantity discount plus cost sharing contract are proposed to coordinate the socially responsible supply chain.This study may provide theoretical support and operational procedures for supply chain managers to integrate corporate social responsibility into business routines.