Decision making and coordination of fresh agriculture product supply chain considering fairness concerns

2020 ◽  
Vol 54 (4) ◽  
pp. 1231-1248
Author(s):  
Bo Yan ◽  
Yan-Ru Chen ◽  
Shi-You He
Keyword(s):  
Supply Chain ◽  
Revenue Sharing ◽  
Agricultural Products ◽  
Nash Bargaining ◽  
Market Demand ◽  
Revenue Sharing Contract ◽  
Behavioral Tendencies ◽  
Fairness Concerns ◽  
The Stability ◽  
Overall Effectiveness

This paper investigates decisions in a supply chain of fresh agricultural products considering fairness concerns. By considering a two-echelon supply chain consisting of a retailer and a manufacturer, this paper discusses the effect of the manufacturer’s fairness concerns and the retailer’s fairness concerns on the fresh agriculture product supply chain within the framework of Nash bargaining. Meanwhile, a revenue-sharing contract is designed to coordinate the supply chain with fairness concerns. The results show that the manufacturer’s behavioral tendency of fairness concerns will reduce their fresh-keeping effort; thereby, the freshness of products and market demand will also decrease. The behavioral tendencies of fairness concerns of both sides reduce the overall effectiveness of the supply chain and adversely affect the stability of the fresh produce supply chain. Both the optimal retail price and the fresh-keeping effort can be achieved while all parties get higher utilities under the revenue-sharing contract in comparison to the case without coordination.

scholarly journals Three-level supply chain coordination of fresh agricultural products in the Internet of Things

2017 ◽  
Vol 117 (9) ◽  
pp. 1842-1865 ◽  
Author(s):  
Bo Yan ◽  
Xiao-hua Wu ◽  
Bing Ye ◽  
Yong-wang Zhang
Keyword(s):  
Supply Chain ◽  
Internet Of Things ◽  
Supply Chain Coordination ◽  
Revenue Sharing ◽  
Agricultural Product ◽  
The Internet ◽  
Market Demand ◽  
Content Type ◽  
Revenue Sharing Contract ◽  
The Internet Of Things

Purpose The Internet of Things (IoT) is used in the fresh agricultural product (FAP) supply chain, which can be coordinated through a revenue-sharing contract. The purpose of this paper is to make the three-level supply chain coordinate in IoT by considering the influence of FAP on market demand and costs of controlling freshness on the road. Design/methodology/approach A three-level FAP supply chain that comprises a manufacturer, distributor, and retailer in IoT is regarded as the research object. This study improves the revenue-sharing contract, determines the optimal solution when the supply chain achieves maximum profit in three types of decision-making situations, and develops the profit distribution model based on the improved revenue-sharing contract to coordinate the supply chain. Findings The improved revenue-sharing contract can coordinate the FAP supply chain that comprises a manufacturer, distributor, and retailer in IoT, as well as benefit all enterprises in the supply chain. Practical implications Resource utilization rate can be improved after coordinating the entire supply chain. Moreover, loss in the circulation process is reduced, and the circulation efficiency of FAPs is improved because of the application of IoT. The validity of the model is verified through a case analysis. Originality/value This study is different from other research in terms of the combination of supply chain coordination, FAPs, and radio frequency identification application in IoT.

scholarly journals Coordinating Three-Level Supply Chain under Disruptions Using Revenue-Sharing Contract with Effort Dependent Demand

2016 ◽  
Vol 2016 ◽  
pp. 1-10 ◽  
Author(s):  
Qinghua Pang ◽  
Yanli Hou ◽  
Yifei Lv
Keyword(s):  
Supply Chain ◽  
Revenue Sharing ◽  
Optimal Contract ◽  
Market Demand ◽  
Numerical Examples ◽  
Revenue Sharing Contract ◽  
Special Case ◽  
Additive Form ◽  
Dependent Demand

Considering that the market demand is stochastic and dependent on effort, this essay shows that the benchmark revenue-sharing contract could not coordinate a three-level supply chain consisting of one manufacturer, one distributor, and one retailer. By assuming that the retailer himself bears the effort cost, coordination is achieved by implementing revenue-sharing contract based on rebate and penalty policy in one transaction or two transactions of three-level supply chain, and the former is a special case of the latter. When the disruptions induce the changes of the market demand, the revenue-sharing contract could not coordinate the supply chain. To deal with the problem, this essay introduces two forms of improved revenue-sharing contracts which have antidisruption ability. The model of improved revenue-sharing contract is optimized when the market demand is in the additive form with effort dependent demand. Formulas are given to calculate the optimal contract parameters. Finally, this essay demonstrates the accuracy of the model of improved revenue-sharing contract with the help of numerical examples.

scholarly journals Three-Level Supply Chain Coordination under Disruptions Based on Revenue-Sharing Contract with Price Dependent Demand

2014 ◽  
Vol 2014 ◽  
pp. 1-11 ◽  
Author(s):  
Qinghua Pang ◽  
Yuer Chen ◽  
Yulu Hu
Keyword(s):  
Supply Chain ◽  
Supply Chain Coordination ◽  
Revenue Sharing ◽  
Optimal Contract ◽  
Market Demand ◽  
Revenue Sharing Contract ◽  
Normal Environment ◽  
Contract Form ◽  
Additive Form ◽  
Dependent Demand

Considering the market demand is stochastic and dependent on price, this paper shows that the revenue-sharing contract could coordinate a three-level supply chain consisting of one manufacturer, one distributor, and one retailer under normal environment. However, the original revenue-sharing contract cannot coordinate the supply chain under disruptions in circumstances of certain incidents leading to significant changes in market demand and causing additional deviation costs. To solve the problem, this essay introduces two improved forms of revenue-sharing contract: a mixed contract form based on a quantity discount policy and a pure form, which are characterized by antidisruption ability. The model of improved revenue-sharing contract is optimized when the market demand is in the additive form or in the multiplicative form with price dependent demand. Formulas are given to calculate the optimal contract parameters. Finally, this essay demonstrates the accuracy of the model of improved revenue-sharing contract with the help of numerical examples.

scholarly journals Assessing the coordinated revenue-sharing contract of China’s farmer-supermarket direct-purchase model

2021 ◽  
pp. 1-16
Author(s):  
Peng Liang ◽  
Melat Sima ◽  
Yu Huang ◽  
Xiaoyu Sun
Keyword(s):  
Supply Chain ◽  
Risk Sharing ◽  
Supply Chain Coordination ◽  
Revenue Sharing ◽  
Market Demand ◽  
Long Term Stability ◽  
Revenue Sharing Contract ◽  
Promotional Efforts

China began connecting farmers directly with supermarkets 10 years ago, when they were at a disadvantage and forced to sell products at low prices, as unstable cooperation among supply chain participants led to inequitable distribution of revenue. Revenue-sharing contracts offer a risk-sharing approach to ensure supply chain coordination and optimize profit for all. Research on short life cycle products with revenue-sharing contracts assume stable prices or investigate the effects of revenue-sharing contracts on supply chain coordination. This study introduced a revenue-sharing contract model into a ‘farmer-supermarket direct-purchase’ supply chain, considering price fluctuation and retail promotional efforts, stochastic market demand, among other factors. Revenue-sharing contracts achieved long-term stability in supply chain coordination, all participants obtained more profits, and the size of revenue-sharing parameter depends on the position and bargaining power of all participants. A case study on Tianhong supermarket and Nanxia farmer cooperative verified these findings, eliciting practical implications for professionals and policymakers.

scholarly journals A Coordinating Strategy for Biofuel Supply Chain under Disturbance Using Revenue Sharing Contract Approach

2018 ◽  
Vol 30 (2) ◽  
pp. 195-204 ◽  
Author(s):  
Nana Geng ◽  
Yong Zhang ◽  
Yixiang Sun
Keyword(s):  
Supply Chain ◽  
Alternative Energy ◽  
Supply Chain Coordination ◽  
Revenue Sharing ◽  
Optimal Order ◽  
Market Demand ◽  
Coordination Problem ◽  
Coordination Strategy ◽  
Revenue Sharing Contract ◽  
Biofuel Supply Chain

Biofuel is considered to be an important alternative energy in the future transportation. Its development is supported by the rest of the world. However, biofuel industry development is still very slow. From the previous research it is known that the supply chain coordination and other problems need to be solved to promote the supply chain ability. This paper studies biodiesel supply chain coordination problem from the view of disturbance management. It gives a disturbed coordination strategy which contains the optimal order quantity and the contract parameters. This paper has then verified the disturbed coordination strategy through using the actual data of Jiangsu Yueda Kate New Energy Co. Ltd. The result shows that when the market demand and the recovery cost are simultaneously disturbed, the coordination can make the biodiesel supply chain robust and the new strategy under the revenue sharing contract is better than the original one.

Supply Chain Coordination through a Revenue-Sharing Contract with Two Kinds of Fuzzy Demand

2017 ◽  
Vol 10 (4) ◽  
pp. 1-17 ◽  
Author(s):  
Junyan Wang ◽  
Yuan Ren
Keyword(s):  
Supply Chain ◽  
Supply Chain Coordination ◽  
Fuzzy Variable ◽  
Revenue Sharing ◽  
Market Demand ◽  
Uncertain Environments ◽  
Revenue Sharing Contract ◽  
Fuzzy Demand ◽  
The One

Revenue-sharing contract is used in many industries. However, it is hard to guarantee that the retailer report the sales truly to the supplier. In fact, the retailer has both incentive and opportunity to underreport the sales to reduce the sharing revenue to the supplier. What the supplier should do when meeting with the opportunistic retailer(s)? This paper studies a kind of opportunistic phenomenon in a supply chain in which a supplier sells to a retailer under a revenue-sharing contract. Two settings are discussed. The first one is that the retailer does not, or cannot underreport the sales to the supplier to share when the supplier design a strict auditing mechanism under which no lies allowed. The second one is that the retailer can underreport the sales to the supplier to share under another soft auditing mechanism. Due to the uncertainty of market demand, it is characterized by a fuzzy variable. Interestingly, we find that the supplier's profit is higher in the second setting than the one in the first setting. We hope that the conclusion drawn in the paper can provide a new viewpoint to help the supplier to solve the problem when meeting with an opportunistic retailer in a supply chain under a revenue-sharing contract in uncertain environments.

Contract coordination optimization of a multi-power supplier-single dominant grid supply chain in hybrid electricity market

2019 ◽  
Vol 119 (9) ◽  
pp. 1861-1887
Author(s):  
Zhenning Zhu ◽  
Lingcheng Kong ◽  
Jiaping Xie ◽  
Jing Li ◽  
Bing Cao
Keyword(s):  
Decision Making ◽  
Supply Chain ◽  
Renewable Energy ◽  
Power Supply ◽  
Electricity Market ◽  
Revenue Sharing ◽  
Market Demand ◽  
Content Type ◽  
Revenue Sharing Contract ◽  
Green Power

Purpose In the hybrid electricity market, renewable energy power generator faces the uncertainty of power market demand and the randomness of the renewable energy generation output. In order to improve the grid-connected quantity of green power, the purpose of this paper is to design the pricing mechanism for renewable energy power generator with revenue-sharing contract in a two-stage “multi-single” electricity supply chain which contains a single dominant power retailer and two kinds of power suppliers providing different power energy species. Design/methodology/approach Considering the dual uncertainties of renewable energy power output and power market demand, the authors design the full-cooperative contract decision-making model, wholesale price contract decision-making model and revenue-sharing contract decision-making model to compare and optimize grid-connected pricing in order to maximize profit of different parties in power supply chain. Then, this paper performs a numerical simulation, discusses the existence of the equilibrium analytical solutions to satisfy the supply chain coordination conditions and analyzes the optimal contract parameters’ variation characteristics and their interaction relationship. Findings The authors find that the expected profits of the parties in the hybrid power supply chain are concave about their decision variables in each decision-making mode. The revenue-sharing contract can realize the Pareto improvement for all parties’ interest of the supply chain, and promote the grid-connected quantity of green power effectively. The grid-connected price will reduce with the increase of revenue-sharing ratio, and this impact will be greater on the renewable energy power. The greater the competition intensity in power supply side, the smaller the revenue-sharing ratio from power purchaser. And for the same rangeability of competition intensity, the revenue-sharing ratio reduction of thermal power is less than that of the green power. The more the government subsidizing green power supplier, the smaller the retailer sharing revenue to it. Practical implications Facing with the dual uncertainties of green power output and market demand and the competition of thermal power in hybrid electricity market, this study can provide a path to solve the problem of renewable energy power grid-connecting. The results can help green power become competitive in hybrid power market under loose regulations. And this paper suggests that the government subsidy policy should be more tactical in order to implement a revenue-sharing contract of the power supply chain. Originality/value This paper studies the renewable energy electricity grid-connected pricing under the uncertainty of power supply and market demand, and compares different contract decision-making strategies in order to achieve the power supply chain coordination. The paper also analyzes the competition between thermal power and renewable energy power in hybrid electricity market.

Tourism Supply Chain Coordination through Revenue Sharing Contract

2014 ◽  
Vol 644-650 ◽  
pp. 6093-6096 ◽  
Author(s):  
Ting Long Zhang ◽  
Yi Wang
Keyword(s):  
Supply Chain ◽  
Stackelberg Game ◽  
Supply Chain Coordination ◽  
Revenue Sharing ◽  
Nash Bargaining ◽  
Travel Agency ◽  
Revenue Sharing Contract ◽  
Scenic Spot ◽  
Participation Constraint ◽  
Tourism Supply Chain

In this paper we develop revenue sharing contracts in a scenic spot –travel agency tourism supply chain. We use the Stackelberg game model to formulate the leader–follower relationship. By backward induction, we obtain equilibrium under the non-cooperative revenue sharing contract and the cooperative revenue sharing contract. Results show that the non-cooperative revenue sharing contract doesn’t meet the travel agency’s participation constraint while the cooperative revenue sharing contract can achieve coordination and Pareto improvement. Finally the Nash bargaining game suggests that scenic spot obtains a larger share of the profit growth due to its higher bargaining power.

scholarly journals Analysis on the Water Supply Chain Model under Revenue-Sharing Contract considering Marketing Effort, Water Purity

2021 ◽  
Vol 2021 ◽  
pp. 1-23
Author(s):  
Lijia Huang ◽  
Deshan Tang
Keyword(s):  
Supply Chain ◽  
Water Supply ◽  
Wholesale Price ◽  
Revenue Sharing ◽  
Chain Model ◽  
Marketing Effort ◽  
Market Demand ◽  
Revenue Sharing Contract ◽  
Comparison Results ◽  
Water Purity

A two-tier water supply chain including a manufacturer and a retailer under revenue-sharing contract is constructed. And the contribution of the model is that marketing effort and water purity has been considered. First, four models including the centralized model (model B) and decentralized models (models BM, I, and II) are established and analyzed. Second, the Stackelberg game model is used to discuss the pricing strategy of water supply chain members in centralized and decentralized scenarios. The comparison results show that revenue-sharing contract is beneficial to improve the level of product greening, the profit of supply chain members, and the overall profit of the water supply chain compared with model BM. However, it leads to the decrease of retailers’ green marketing efforts and the wholesale price of water. In addition, revenue-sharing contract through bargaining makes bigger influence than revenue-sharing contract. Marketing can stimulate the increase of the green product’s market demand on one hand, and on the other hand, it generates the amount of marketing cost. In this study, the profit is that marketing produces cannot offset the cost that it brings. Thus, it will be important to take some measures to make up the loss that marketing generated.

Sign in / Sign up

Export Citation Format

Share Document