International Journal of Industrial Engineering & Production Research

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Abstract Firms no longer compete as autonomous entities and prefer to joinin a supply chain alliance to take advantage of highly competitive business situation. Supply chain coordination has a greatimpact on Firm’sstrategic partnering and success in competitive business environment. In this paper, we propose a system dynamics simulation model for strategic partner selection in supply chain. Our model addresses a supply chain including suppliers and retailers. It presents an approach to simulateeach supplier’s (retailers) tendency to select downstream (upstream) partner selection and the impact of their policies in the whole supply chain.

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In recent years, comprehensive researches have provided ample support for the supply chains in the coordinated decision-making framework. However, the issue of closed-loop supply chain coordination considering various transportation modes has not yet been addressed in the literature. In this paper, a two-echelon closed-loop supply chain consisting of a manufacturer and a retailer is investigated in which the manufacturer acts as a Stackelberg leader and the retailer plays follower role. All transportation activities between the channel members are carried out via two transportation types including the economic and green modes. First, the proposed problem is examined under the decentralized and centralized settings. Then, a mathematical modeling is developed to coordinate the decisions related to retail price, collection effort, and ratio of transportation mode selection. Finally, some numerical examples are applied with the aim of analyzing the performance of decentralized, centralized, and coordinated decision-making structures. The results reveal that not only the Pareto optimal solution is achievable for both channel members but also the coordination scheme has sufficient efficiency to reach the best solution up to the centralized setting.

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Nowadays, competitive market creates the necessity of quality improvement in different levels of supply chains (SCs). This paper contributes to the SC coordination literature and proposes a bilateral coordination contract for optimizing pricing decisions along with quality improvement decisions in different echelons of a real case of a cell phone SC. The SC comprises a manufacturer who deals with determining the product quality, and a retailer who seeks for the optimal strategy on price, after-sale service and service level in a periodic review inventory system. The proposed bilateral wholesale price (BWP) contract is shown to be capable of simultaneous coordination of these decisions. The sensitivity analysis showed that in a market which is sensitive to quality and after-sale service as well as the product price, the proposed model facilitates investing more in such quality improvements while the members’ profitability with respect to the case without contracts is guaranteed. Moreover, it can increase the SC service level since it enables the members to hold more safety stock even under high inventory costs. Overall, the proposed coordination model on pricing, product quality, after-sale service and service level, leads to the optimal performance of the SC and its members while it is beneficial for the customers.

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In this research, we analyze a supply chain involving two competing manufacturers that sells their product through two common competing retailers. The manufacturers’ products are the same but with different brand in market. The retailers face stochastic demand where demand is a decreasing function of price with additive uncertain part. Manufacturers compete on supplying orders where retailers compete on selling price. Each manufacturer set wholesale price contract with retailers similarly. We examine supply chain coordination with wholesale price contract under competition and demand uncertainty. The analytical results show that under coordination condition, manufacturers do not obtain any positive profit and consequently the retailers intend to increase wholesale prices. On the other hand, manufacturers can increase wholesale prices until the retailers’ profit becomes zero. Hence, with a numerical study for actual cases, it is found that changing demand sensitivity and competition intensity affect the optimal decisions of ordering and pricing. Moreover, increasing in competition sensitivity, increase the supply chains’ efficiency, stocking level and selling price. The concluding remarks show that further investigation is required for possibility of coordination under competition by other contractual mechanisms.