October  2007, 3(4): 715-726. doi: 10.3934/jimo.2007.3.715

Coordination of supply chain with buyer's promotion


Department of Logistics Management, School of Economics and Management, Beijing Jiaotong University, Beijing, 100044, China

Received  August 2006 Revised  July 2007 Published  October 2007

In this paper, we develop a model to analyze the coordination of a supply chain with the demand influenced by the buyer's promotion. The supply chain consists of a supplier and a group of homogeneous buyers. The buyers choose inventories ex ante and promotional levels ex post. The annual demand rate depends on the promotional level and the operating cost---including the ordering and inventory holding cost---depends on the promotional level and the order quantity. It is shown that quantity discount alone is not sufficient to guarantee joint profit maximization. Then we propose a contract, discount quantity with transfer profit contract, and show that this contract can coordinate the supply chain. Moreover, it is shown that this policy is robust because it can allocate the supply chain profit arbitrarily between the supplier and the buyer and lead the buyer to choose the joint optimal promotional level and the supplier need not to observe and verify the buyer's promotional level. For the special case that the operating cost is a fixed constant, we show that there is no contract which can coordinate the supply chain if the promotion is unobservable and unverifiable and the discount policy can guarantee the coordination of the supply chain if the promotion is observable and verifiable.
Citation: Juliang Zhang. Coordination of supply chain with buyer's promotion. Journal of Industrial & Management Optimization, 2007, 3 (4) : 715-726. doi: 10.3934/jimo.2007.3.715

Juliang Zhang, Jian Chen. Information sharing in a make-to-stock supply chain. Journal of Industrial & Management Optimization, 2014, 10 (4) : 1169-1189. doi: 10.3934/jimo.2014.10.1169


Min Li, Jiahua Zhang, Yifan Xu, Wei Wang. Effects of disruption risk on a supply chain with a risk-averse retailer. Journal of Industrial & Management Optimization, 2021  doi: 10.3934/jimo.2021024


Benrong Zheng, Xianpei Hong. Effects of take-back legislation on pricing and coordination in a closed-loop supply chain. Journal of Industrial & Management Optimization, 2021  doi: 10.3934/jimo.2021035


Reza Lotfi, Yahia Zare Mehrjerdi, Mir Saman Pishvaee, Ahmad Sadeghieh, Gerhard-Wilhelm Weber. A robust optimization model for sustainable and resilient closed-loop supply chain network design considering conditional value at risk. Numerical Algebra, Control & Optimization, 2021, 11 (2) : 221-253. doi: 10.3934/naco.2020023


Cicely K. Macnamara, Mark A. J. Chaplain. Spatio-temporal models of synthetic genetic oscillators. Mathematical Biosciences & Engineering, 2017, 14 (1) : 249-262. doi: 10.3934/mbe.2017016


Fernando P. da Costa, João T. Pinto, Rafael Sasportes. On the convergence to critical scaling profiles in submonolayer deposition models. Kinetic & Related Models, 2018, 11 (6) : 1359-1376. doi: 10.3934/krm.2018053


Jian Yang, Bendong Lou. Traveling wave solutions of competitive models with free boundaries. Discrete & Continuous Dynamical Systems - B, 2014, 19 (3) : 817-826. doi: 10.3934/dcdsb.2014.19.817


Liqin Qian, Xiwang Cao. Character sums over a non-chain ring and their applications. Advances in Mathematics of Communications, 2021  doi: 10.3934/amc.2020134


Shanshan Chen, Junping Shi, Guohong Zhang. Spatial pattern formation in activator-inhibitor models with nonlocal dispersal. Discrete & Continuous Dynamical Systems - B, 2021, 26 (4) : 1843-1866. doi: 10.3934/dcdsb.2020042


Alina Chertock, Alexander Kurganov, Mária Lukáčová-Medvi${\rm{\check{d}}}$ová, Șeyma Nur Özcan. An asymptotic preserving scheme for kinetic chemotaxis models in two space dimensions. Kinetic & Related Models, 2019, 12 (1) : 195-216. doi: 10.3934/krm.2019009


Wen-Bin Yang, Yan-Ling Li, Jianhua Wu, Hai-Xia Li. Dynamics of a food chain model with ratio-dependent and modified Leslie-Gower functional responses. Discrete & Continuous Dynamical Systems - B, 2015, 20 (7) : 2269-2290. doi: 10.3934/dcdsb.2015.20.2269


Mats Gyllenberg, Jifa Jiang, Lei Niu, Ping Yan. On the classification of generalized competitive Atkinson-Allen models via the dynamics on the boundary of the carrying simplex. Discrete & Continuous Dynamical Systems - A, 2018, 38 (2) : 615-650. doi: 10.3934/dcds.2018027


Nhu N. Nguyen, George Yin. Stochastic partial differential equation models for spatially dependent predator-prey equations. Discrete & Continuous Dynamical Systems - B, 2020, 25 (1) : 117-139. doi: 10.3934/dcdsb.2019175


Luigi C. Berselli, Jishan Fan. Logarithmic and improved regularity criteria for the 3D nematic liquid crystals models, Boussinesq system, and MHD equations in a bounded domain. Communications on Pure & Applied Analysis, 2015, 14 (2) : 637-655. doi: 10.3934/cpaa.2015.14.637

2019 Impact Factor: 1.366


  • PDF downloads (44)
  • HTML views (0)
  • Cited by (2)

Other articles
by authors

[Back to Top]