Disposing the leftovers under the consignment contract with revenue sharing: Retailer vs supplier |
| |
Authors: | Wei Hu Jianbin Li |
| |
Institution: | Wei HU School of Mathematical Sciences and LPMC,Nankai University,Tianjin 300071,China. Jianbin LI School of Management,Huazhong University of Science and Technology,Wuhan 430074,China. |
| |
Abstract: | This paper studies the consignment contract with revenue sharing where the retailer offers two revenue share schemes between
himself and his supplier from the viewpoint of inventory ownership: One is that the retailer takes charge of the unsold items,
the other one is that the retailer returns the unsold items to the supplier at the end of the selling period, and the supplier
disposes those overstockings. In each contract, the retailer deducts a percentage from the selling price for each sold item
and transfers the balance to the supplier. The supplier solves a two-stage problem: She first chooses contract, then decides
retail price and delivery quantity according to the terms of the contract chosen. With an iso-price-elastic demand model,
the authors derive the retailer and suppliers’ optimal decisions for both schemes. In addition, the authors characterize how
they are affected by disposing cost. The authors compare the decisions between the two schemes for disposing cost turn out
to be holding cost or salvage value, respectively. The authors use numerical examples to show the supplier’s first-stage optimal
decision depends critically on demand price elasticity, the disposing cost and the retailer’s share for channel cost. |
| |
Keywords: | |
本文献已被 CNKI SpringerLink 等数据库收录! |
|