Bargaining in a Two-Stage Supply Chain Through Revenue-Sharing Contract推荐.pdfVIP

Bargaining in a Two-Stage Supply Chain Through Revenue-Sharing Contract Jing Hou and Amy Z. Zeng Abstract We focus on a bargaining problem between one supplier and one retailer that are coordinated by a revenue-sharing contract. The suppler is assumed to have the ability to influence the retailer’s profit by setting his/her target inventory level, which in turn determines the lead time. We examine the cases under which either the supplier or the retailer is dominant in the bargaining process. The key contract parameter, the acceptable range of the revenue-sharing fraction for the two players, and the maximum amount of monetary bargain space are obtained under explicit and implicit information, respectively. Numerical illustrations of the contracts for various scenarios are given to shed more insights. Keywords Dominance and bargaining • Nonlinear optimization • Supply chain coordination • Supply contracts 1 Introduction Revenue sharing mechanism has been applied extensively in various industries, such as internet service (e.g., He and Walrand 2005), airline (e.g., Zhang et al. 2010), and virtual enterprises (e.g., Chen and Chen 2006) – to name a few, as an efficient vehicle to achieve coordination, because it is relatively straightforward J. Hou (*) Business School, Hohai University, Nanjing, Jiangsu 211100, China e-mail: penguinhj@163.com A.Z. Zeng School of Business, Worcester Polytechnic Institute, Worcester, MA 01609, USA e-mail: azeng@ T.-M. Choi and T.C. Edwin Cheng (eds.), Supply Chain Coordination under Uncertainty, 347 International Handbooks on Information Systems, DOI 10.1007/978-3-642-19257-9_14, # Springer-Verlag Berlin Heidelberg 2011 348 J. Hou and A.Z. Zeng for the decision makers to implement and manage the contract. The primary objec- tive of the revenue-sharing contract is to align the two pa