Research On Revence-sharing Contract Based On Vmi Supply Chain

With the development of economic globa lization, the competition amongenterprises is increasing and has been transferring to the competition between thesupply chains. Just in this context, supply chain ma nagement, a new enterprisema nagement method, came into being. There are some new requirements aboutinventory control in supply chain ma nagement and the limitations of the traditiona ltheory of the inventory ma nagement have appeared. Inventory ma nagement is one ofthe important component elements in supply chain ma nagement. The inventory levelnot only affects the integrated cost of an enterprise, but also restricts the entire supplychain's overa ll performa nce. Therefore, how to make the inventory ma nagement modemore effective, achieving the goals of low-cost and high-profit of enterprises andsupply chains, has become a core issue of corporate concern. Few new inventoryma nagement methods have attracted ma ny scholars'concern at home and abroad, suchas: Aggrega te Forecasting and Replenishment (AFR), Vendor Managed Inventory(VMI) and Collaborative Planning, Forecasting & Replenishment (CPFR). VendorManaged Inventory, a new inventory ma nagement method which reflects the integratedidea of supply chain ma nagement, enjoys high favor among business world andeducationa l circles .After a great deal of research on VMI, scholars have proved that VMI does canimprove the entire supply chain's overa ll performa nce, but cannot reach the supplychain coordination. For Suppliers and retailers, the expected revenue would increasein the long term. But the Suppliers'expected revenue would decrease in the short time .So the member enterprises should redistributed profits in order to let suppliers beinterested in taking part in VMI. Based on the previous studies, this paper studies howto redistribute profits in VMI supply chain for the purpose of achieving supply chaincoordination:1) This paper expounds the theories of VMI supply chain, inventory ma nagementand supply chain contract based on the correla tion studies status and practice at homeand abroad, which la ys the groundwork for after analysis.2) Considering storing cost, shortage penalty cost and salva ge value , this paperbuilds three expected revenue models of integrated, distributed and VMI supply chainunder the stochastic dema nd. Finally, we arrive at some conclusion s throughcontrastive analysis. 3) This paper studies revenue-sharing contract in VMI supply chain, and findsthat the supply chain coordination cannot be achieved trough revenue-sharing contractonly. But with surplus subsidy contract together, we can get a Pareto optimum intervalof revenue-distributed proportion. Any value in this interval could make the VMIsupply chain coordinate d.The studies have enriched the content of revenue-sharing contract theory in VMIsupply chain, provided a theoretica l support for establishing a long-term effectivecooperation mecha nism VMI and a scientific basis for decision makers, and have theimportant theoretica l and practica l value.