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Supply chain network equilibrium with revenue sharing contract under demand disruptions

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Abstract

Contract is a common and effective mechanism for supply chain coordination, which has been studied extensively in recent years. For a supply chain network model, contracts can be used to coordinate it because it is too ideal to obtain the network equilibrium state in practical market competition. In order to achieve equilibrium, we introduce revenue sharing contract into a supply chain network equilibrium model with random demand in this paper. Then, we investigate the influence on this network equilibrium state from demand disruptions caused by unexpected emergencies. When demand disruptions happen, the supply chain network equilibrium state will be broken and change to a new one, so the decision makers need to adjust the contract parameters to achieve the new coordinated state through bargaining. Finally, a numerical example with a sudden demand increase as a result of emergent event is provided for illustrative purposes.

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Authors and Affiliations

  1. Institute of Systems Engineering, Southeast University, Nanjing, 210096, PRC

    A.-Ting Yang & Lin-Du Zhao

Authors
  1. A.-Ting Yang
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  2. Lin-Du Zhao
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Corresponding author

Correspondence to Lin-Du Zhao.

Additional information

This work was supported by the National Key Technology R&D Program of China (No. 2006BAH02A06) and “333 Engineering” Project of Jiangsu Province.

A-Ting Yang received the B.A. degree in logistics management from southeast university, PRC in 2009. She is currently a master student in the Institute of Systems Engineering, Southeast University, PRC.

Her research interests include supply chain risk management and supply chain resilience.

Lin-Du Zhao received the B.A. degree in industrial psychology from Hangzhou University, PRC in 1988, M. Sc. degree in computer application from Jiangsu University of Science and Technology, PRC in 1993, and Ph.D. degree in systems engineering from Southeast University, PRC in 1997. He is currently a professor and director in the Institute of Systems Engineering at Southeast University.

His research interests include complex system analysis and decision making, supply chain and logistics management, emergency management, and food safety management.

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Yang, AT., Zhao, LD. Supply chain network equilibrium with revenue sharing contract under demand disruptions. Int. J. Autom. Comput. 8, 177–184 (2011). https://doi.org/10.1007/s11633-011-0571-7

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  • DOI: https://doi.org/10.1007/s11633-011-0571-7

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