Innovative menu of contracts for coordinating a supply chain with multiple mean-variance retailers

2015 ◽  
Vol 246 (3) ◽  
pp. 815-826 ◽  
Author(s):  
Chun-Hung Chiu ◽  
Tsan-Ming Choi ◽  
Gang Hao ◽  
Xun Li
Keyword(s):  
Supply Chain ◽  
Mean Variance

Supply chain risk analysis with mean-variance models: a technical review

2013 ◽  
Vol 240 (2) ◽  
pp. 489-507 ◽  
Author(s):  
Chun-Hung Chiu ◽  
Tsan-Ming Choi
Keyword(s):  
Supply Chain ◽  
Risk Analysis ◽  
Supply Chain Risk ◽  
Technical Review ◽  
Mean Variance

scholarly journals Channel Coordination of a Risk-Averse Supply Chain: Mean-Variance Approach

2015 ◽  
Author(s):  
Indranil Biswas ◽  
Arnab Adhikari ◽  
Baidyanath Biswas
Keyword(s):  
Supply Chain ◽  
Channel Coordination ◽  
Risk Averse ◽  
Mean Variance ◽  
Variance Approach

scholarly journals Sales Rebate Contracts in Fashion Supply Chains

2012 ◽  
Vol 2012 ◽  
pp. 1-19 ◽  
Author(s):  
Chun-Hung Chiu ◽  
Tsan-Ming Choi ◽  
Ho-Ting Yeung ◽  
Yingxue Zhao
Keyword(s):  
Supply Chain ◽  
Supply Chains ◽  
Empirical Data ◽  
Numerical Analyses ◽  
Retail Sales ◽  
Rebate Contracts ◽  
Rebate Contract ◽  
Mean Variance

We explore in this paper the performance of sales rebate contracts in fashion supply chains. We conduct both analytical and numerical analyses via a mean-variance framework with reference to real empirical data. To be specific, we evaluate the expected profits and variance of profits (risk) of the fashion supply chains, fashion retailers, and manufacturers under (1) the currently implemented sales rebate practices, (2) the case without sales rebate, and (3) the theoretical coordination situation (if target sales rebate is adopted). In addition, we analyze how sales effort affects the performances of the supply chain and its agents. Our analysis indicates that the rebate contracts may hurt the retailer and the manufacturer of a fashion supply chain when it is inappropriately set. Moreover, a properly designed sales rebate contract not only can coordinate the supply chain (with retail sales effort) but can also improve expected profits and lower the levels of risk for both the manufacturer and the retailer.

scholarly journals Coordinating Contracts for Two-Stage Fashion Supply Chain with Risk-Averse Retailer and Price-Dependent Demand

2013 ◽  
Vol 2013 ◽  
pp. 1-12 ◽  
Author(s):  
Minli Xu ◽  
Qiao Wang ◽  
Linhan Ouyang
Keyword(s):  
Supply Chain ◽  
Supply Chain Coordination ◽  
Revenue Sharing ◽  
Channel Coordination ◽  
Risk Averse ◽  
Revenue Sharing Contract ◽  
Risk Neutral ◽  
Mean Variance ◽  
Variance Approach ◽  
Dependent Demand

When the demand is sensitive to retail price, revenue sharing contract and two-part tariff contract have been shown to be able to coordinate supply chains with risk neutral agents. We extend the previous studies to consider a risk-averse retailer in a two-echelon fashion supply chain. Based on the classic mean-variance approach in finance, the issue of channel coordination in a fashion supply chain with risk-averse retailer and price-dependent demand is investigated. We propose both single contracts and joint contracts to achieve supply chain coordination. We find that the coordinating revenue sharing contract and two-part tariff contract in the supply chain with risk neutral agents are still useful to coordinate the supply chain taking into account the degree of risk aversion of fashion retailer, whereas a more complex sales rebate and penalty (SRP) contract fails to do so. When using combined contracts to coordinate the supply chain, we demonstrate that only revenue sharing with two-part tariff contract can coordinate the fashion supply chain. The optimal conditions for contract parameters to achieve channel coordination are determined. Numerical analysis is presented to supplement the results and more insights are gained.

scholarly journals Sourcing decision under interconnected risks: an application of mean–variance preferences approach

2022 ◽  
Author(s):  
Soumyatanu Mukherjee ◽  
Sidhartha S. Padhi
Keyword(s):  
Supply Chain ◽  
Decision Maker ◽  
Raw Materials ◽  
Drug Manufacturer ◽  
Perfect Competition ◽  
Supply Side ◽  
Demand Side ◽  
The Mean ◽  
Supply Chain Risks ◽  
Mean Variance

AbstractSupply chains are customarily associated with multiple interconnected risks originated from supply side, demand side, or from the unanticipated background uncertainties faced by a firm. Also, effective functioning of supply chain hinges on sourcing decisions of inputs (raw materials). Therefore, there is a striking need to analyse the risk preference of the decision maker while going for optimal sourcing decision under varying degree of interconnected supply chain risks. This study addresses this issue by analysing the comparative static effects under interconnected supply chain risks for a risk averse decision-maker, manufacturing and selling products in a regulated market under perfect competition. The decision-maker faces not only supply-side risk (due to random input material prices) but also interconnected risks arising out of background risk (setup costs risk) and demand-side risk (output prices risk). With preferences defined over the mean and standard deviation of the uncertain final profit, this study illustrates the effects of the changes in the pairwise correlations between the three above mentioned risks on the optimum input choice of the manufacturer. To contextualise this study, an India-based generic drug manufacturer cum seller has been considered as a case in the parametric example of our model. Adaptation of the mean–variance framework helps obtaining all the results in terms of the relative trade-off between risk and return, with simple yet intuitive interpretations.

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