Coordination in a retailer-led supply chain through option contract

作者：Wang Xiaolong^*; Liu Liwen

来源：International Journal of Production Economics, 2007, 110(1-2): 115-127.

DOI：10.1016/j.ijpe.2007.02.022

• channel coordination
• risk sharing
• retailer-led supply chain
• option contract

This paper develops a model to study channel coordination and risk sharing in a retailer-led supply chain. Such chains are characterized by a dominant retailer who aims to coordinate the upstream production quantity. We investigate a coordinating contract based on an option with two parameters. An option price is paid by the retailer for each additional unit of product reserved beyond the initial order. An exercise price serves as the unit purchasing price when the retailer sets a second order if realized demand is more than the initial order. A successful coordination needs two conditions. One condition is to maintain a negative correlation between exercise price and option price. Particularly, we draw the functional form. The other is that the firm commitment must be lower than the optimal production quantity in a centralized system. In a risk sharing mechanism, we prove that such a contract brings benefit to each party.

• 出版日期2007-10
• 单位清华大学