Coordination and Risk Sharing with Considering Supply Chain External Quality Fault
Li Yongfei 1,2
COMPUTER MODELLING & NEW TECHNOLOGIES 2014 18(12C) 445-450
1 School of Economic and Management, Xi'an University of Posts and Telecommunications South Road of Changan, 563, Xi'an, China
2 Shaanxi philosophy and social science research base - Information Industry Development Research Center, Xi'an, China
Based on theory of Stackelberg non-cooperative game, this paper studies the coordination and risk-sharing problem in a supply chain under considering external quality fault. The Supply chain is consisted by one supplier and one retailer around a single product within one period. This paper presents the optimal profit, the optimal order quantity, coordination and the risk sharing problem in a supply chain by buyback contract under considering external quality fault. This mainly contributes of the paper are as follows. First, the supplier should avoid external quality fault and allow the retailer return his order quantity with wholesale price in a coordinated supply chain. Second, the optimal expected profit in a supply chain without quality fault is smaller than it when the external quality fault occurs, but the risk sharing in the case is larger. Third, the risk sharing of all parties in the coordinated supply chain are all positively correlated with the quality fault rate, the scrap rate, the wholesale price and the retail price but non-correlated with the buyback contract.