The Study Of Supply Chain Contract Based On Option

Each node enterprises in the supply chain have its own decision-makingobjectives, and the node enterprises’ decisions are often not the supply chain system’soptimal sequence of decisions. Therefore, how to design the contract of the supplychain to achieve the optimal overall performance of suppliers and to increase theinterests of the members of the supply chain has important significance.This paper took the option as a research tool and a two-level supply chain systemcomposed of a single retailer and a single supplier as the research object. We studiedthe supply chain contract model of seasonal products. This paper studied thefollowing questions:1) We established the standard model of supply chain contracts and four basicsupply chain models on the basis of analyzing the supply chain contract, and gave theretailers and suppliers’ optimal decisions in the decentralized situation.2) On the basis of Barnes-Schuster model, we established the option-basedsupply chain contract model and analyzed the optimal ordering policy of retailers andsuppliers in the decentralized decision-making. We found that under decentralizeddecision-making situation we couldn’t reach the optimal overall performance of thesupply chain. Through the design of supply chain contracts, we optimized supplychain’s overall performance and increased the individual interests of retailers andsuppliers.3) Based on options and supply chain model, we considered the spot marketprices, time value of money and the deferred payment in our model. We gave theoptimal ordering policy of retailers and suppliers in the decentralized decision-making,and found that under decentralized decision-making situation we couldn’t reach theoptimal overall performance of the supply chain. We also studied the design of supplychain contracts in order to optimize supply chain’s overall performance and toincrease the individual interests of retailers and suppliers.