Study On Supply Chain Ordering Models Based On Delay In Payments

As the rapid development of the global and integration economy, the dependence relationship between enterprises becomes very important. At the same time, customer’s requirement becomes more and more personalized. Enterprises have begun to put the supply chain management as the new competitive strategy. Supply chain management is the process that planning, coordinating, controlling and optimizing the supply chain system. It emphasizes the cooperation and coordination between companies. However, supply chain members activities are all independent and rational when they participate in business. They make their decision for the purpose of maximizing their profit. As a result, their decision would damage the whole supply chain benefit.Delay in payments is a kind of the short-term commercial credit, it is commonly found in daily trading activities, especially in retail business. In order to stimulating retailers to increase the order quantity, suppliers often provide preferential policies to retailers that allowing retailers postponing payment. At the same time, retailers would also allow customers to postpone payment to irritate customers buying the product. By permitting retailers delay in payments, supplier could enhance the control of retailers, acknowledge the retailers’credit condition, and hide the behavior of price discrimination. The greatest advantage of de delay in payments is that all members of supply chain could reduce their inventory cost and trade cost.In this paper, on the basis of previous studies, the author has study the problem of retailer’s order decision an supplier’s production decision based on delay in payments, and extend the research to three-level supply chain.The first two chapters are introduction and literature review. In the first part, the author introduced the background and objection of the research, and then pointed out the research idea and method. Finally, this author enumerated innovations of this paper. In the second chapter, the author has reviewed current literatures, and enumerated previous researchers’achievement in this field. Through reviewing current literatures, the author has pointed out previous researchers’ deficiency, and provided the basis for further researching.In the third chapter, the author has supposed that in a three-level chain, the supplier permit the retailer to delay the payment, and the retailer is also allow customers to postpone the payment, customers’need is related to the period that retailer permit customers to postpone payment. Based on the hypothesis the author studies the retailer’s optimal ordering decision and vendor’s optimal production decision. In this chapter, the author models the vendor’s and retailer’s profit function, and then determined the retailer’s optimal order quantity and supplier’s optimal production batch. In the last part, the author analyzed the impact of parameters on the final decision through numerical simulating.In the fourth chapter, the author research the optimal retail’s order decision optimal supplier’s production decision two levels of trade credit policy. In this chapter, the retailer would decide the optimal period of allowing customer to delay in payments as well as the optimal order quantity.In the fifth chapter, the author put the cash discount policy into the research. To reduce the financial risk, vendors would like to provide cash discount to retailers. In this section, the author discusses the supply chain participants’optimal decision with delay in payments and cash discount. Additionally, considering the vendor’s risk preference, the author provides the method of calculating the optimal cash discount rate for the vendor.