Research On Coordination Contract Based On Risk Aversion

Since entering21st century, Supply Chain Coordination has become a new Manage concept and Management Philosophy in the academic community of the management study. Under the background, a large number of scholars have turned their attention to the Supply Chain Coordination. In terms of supply chain management, it is a generalized Value Chain, so the most important problem of the SCM is how to breaking up value reasonably. For the moment, there are some fairly mature Supply Chain Contract such as Wholesale Price Contract、Revenue-sharing Contract、Quantity Flexibility Contract、Quantity Discount Contract、Sales-rebate Contract and so on. However, most of them center attention on the problem how to improve expected benefits or reduce expected costs instead of considering the Risk Preference, which are unable to adapt to uncertainty of the market environment. So Supply Chain Contract without considering the Risk Preference will not be implemented smoothly. So considering Risk Preference makes sense to Supply Chain Contract.Starting from the reality, this article designs a extended repurchase agreement under the Downside-Risk measure and a consignment sales contract under CVaR measure in the supply chain consisted of a supplier and retailer with risk aversion by modeling and qualitative analysis. As a result, the perfect supply chain coordination contract is achieved. The contents of the paper are listed as follow:First and foremost, this paper investigates Coordination of CLSC where supplier and retailer have risk aversion, manufacturer is responsible to manufacturing of new products and remanufacturing of recycled products, retailer is responsible for selling and recycling. This paper designs extended buy-back contract which meet the constraint of Downside-Risk. The optimization of supply chain profit and reasonable profit distribution between retailer and manufacturer is realized.In the second place, this paper studied the coordination of supply chain revenue-sharing contract under consignment sales with CVaR measure. Under this contract, supposed information is symmetrical, the retailer decide the rate of revenue sharing and cost sharing, the supplier decide the production, the salvage value and shortage cost are considered, and a Stackelberg game model is developed where the retailer and the supplier is a follower. The relationship of decisions between decentralized and centralized supply chain under consignment sales are analyzed. The impacts of system parameters on the supply chain and its members’ performance are discussed and the numerical calculation is done.Finally, a summary of the full text is brought, which sums up the conclusions and contribution of this paper, points out the inadequacy, and further research directions.