The Study On Supply Chain Contracts Under Delay In Payment

In today’s business practices, whether based on what the reason, perhaps because suppliers encourage retailers to order more goods, perhaps because retailers’capital is limited, delay payment has become one important means of supply chain coordination.it is one main kind of short-term commercial credit ways.There are various forms of deferred payment. Some suppliers give retailers deferred payment or cash discount based on retailers’order quantity, and suppliers often set a fixed order quantity. When the retailer’s order quantity reach the set value, the supplier will provide deferred payment to the retailer, otherwise it will not give any concessions. According to the actual situation, this paper assumes that supplier set a fixed order quantity for retailer, if the amount of retailer’s orders reach the set value, it will enjoy the full payment of the deferred payment, if the amount don’t reach the set value, it will enjoy partial payment of the deferred payment, not without no concessions, because this method can stimulate retailers to order more goods with a greater extent.Based on the above circumstances, firstly.this paper reviewed the literatures home and abroad about delay in payment, and understood the research situation, and found out the breakthrough point of this study; secondly. this paper described the theories about delay in payment and supply chain; Next the third chapter established secondary supply chain model based on the order quantities, gave the solving process of retailers" optimum order cycle and the minimum total annual cost in a variety of circumstances, and gave the existence of the conditions of the solution; finally, based on the third chapter,the forth chapter, what’s the key of this article, extended delay in payment to three-level supply chains, and combined the cases of wholesalers and retailers enjoy the delay in payment, the combination of the four situations were both wholesalers and retailers have received privileges of full funds delay in payment、one of the two parties obtained partial payment deferred and the other obtained all payment deferred、both obtained partial payment deferred, and discussed various situations, gave the solving process of wholesalers’optimum order cycle and the minimum total annual cost in a variety of circumstances, and gave the existence of the conditions of the effective solution, last there was a numerical example, based on numerical example to draw some conclusions.The conclusions suggest that the change of the proportion of delay in payment will affect the change of the cost of supply chain, but it must depend on the specific situation and make specific decision. When in the three-level supply chain, the proportion of delay in payment is not better when it is bigger. This will depend on the relation of two deferred time and wholesaler’s order cycle time. The change of order cost will also affect the change of supply chain order policy. Because increasing order cost can lead to the conditions within a single model matched change from T<N <M into N<M<T situation. Order cost continue to increase, the optimal purchase cycle is increasing, the total cost is rising; when the order cost is fixed, with the growth of deferred payment period, the optimal purchase cycle is increasing, but the total cost is declining.