Contracting Based On Asymmetric Information And Time-sensitive Customers

The thesis studies a supply chain consisting of two heterogeneous suppliers and onemanufacturer facing lead-time-sensitive demands. One supplier is overseas and offers highquality modules with relatively long lead time while another one is the local supplier, whocan produce inferior quality modules with flexible delivery time and private productioncost information (either low or high cost type). Excess customers over the orders from theoverseas supplier, who are sensitive to the delivery time, may be satisfied by modulesfrom the local one.Based on the above background, a two-stage Stackelberg game is then constructed:(1)In stage2the manufacturer decides the order quantity presented to the supplier abroad andcarefully designs his sourcing strategy with the local supplier;(2) In stage1the supplierabroad makes decision about the wholesale price of the module as the supply chain leader.We show that based on a threshold type policy (the value of PMS), the manufacturer havethe following choices:(1) Denying the local supplier;(2) Allowing only the low cost type;(3) Permitting both cost types of the local supplier. When both cost types participate,whether the manufacturer differentiates the local supplier is also threshold type controlled(the price of the final product). When the price of the final product is high, themanufacture would give up the attention to differentiate the cost types of the local supplier,while aiming at decreasing the lead time in order to obtain larger potential market size;otherwise, the manufacturer would rather differentiate the cost types of the local supplieras to decrease the sourcing cost. We further analyze how the delivery time guaranteeelasticity and the bargaining power of the local supplier affect performance of each partyin the supply chain through either analytical or numerical studies.