Abstract
This paper studies supply chain contracts strategy under service level constraint with one manufacturer and one retailer when demand is uncertain and dependent on effort and price. False failure returns model is built under decentralized supply chain. To solve the problem of double marginalization, two contracts, including the traditional buy-back contract and the contract based on rebate and penalty are designed to coordinate the supply chain. As the results have shown, the contract based on rebate and penalty could better coordinate the supply chain. Retailer’s effort is encouraged by rebate and penalty and whether to improve the service level to gain a larger profit should be further concerned with cost and benefit.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Similar content being viewed by others
References
Cachon GP (2003) Supply chain coordination with contracts. Handb Oper Res Manage Sci 11:227–339
Ferguson M, Guide VDR, Souza GC (2006) Supply chain coordination for false failure returns. Manuf Serv Oper Manage 8(4):376–393
Li Q, Zhang Q, Zhu X (2009) Research defective product can be completely returned inventory control models. China Manage Sci 17(6):116–121
Mostard J, Teunter R. (2006) The newsboy problem with resalable returns: a single period model and case study. Eur J Oper Res 169(1):81–96.
Shear H, Speh T, Stock J (2002) Many happy (product) returns. Harvard Bus Rev 80(7):16–17
Vlachos D, Dekker R (2003) Return handling options and order quantities for single period products. Eur J Operl Res 151(1):38–52
Zhang X, Tian P, Nali S (2010) Manufacturers and retailers to work together to reduce the non-defective returns Revenue Sharing Contract. Tech Econ 29(005):110–113
Acknowledgments
This research was funded by the Lab of Logistics Management and Technology and supported by NSFC (Grant No. 71390034)
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2015 Springer-Verlag Berlin Heidelberg
About this paper
Cite this paper
Su, M., Lan, H. (2015). Supply Chain Coordination based on Effort and Service Level with False Failure Returns. In: Zhang, Z., Shen, Z., Zhang, J., Zhang, R. (eds) LISS 2014. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-662-43871-8_192
Download citation
DOI: https://doi.org/10.1007/978-3-662-43871-8_192
Published:
Publisher Name: Springer, Berlin, Heidelberg
Print ISBN: 978-3-662-43870-1
Online ISBN: 978-3-662-43871-8
eBook Packages: Business and EconomicsBusiness and Management (R0)