Abstract: Supply chain contract is an important factor in affecting the overall performance of VMI supply chain, so the supply chain contract has become a noteworthy research topic recently. In this paper the two-stage VMI supply chain coordination problem is investigated with a single supplier and a single retailer. Based on unfair aversion supplier assumption, the supplier's disadvantageous unfair aversion and advantageous unfair aversion are portrayed by the unfair aversion model. Then, the supplier's optimal strategies are analyzed at the distributed VMI supply chain. And the two-stage VMI supply chain coordination problem with wholesale price contract is studied. By the analysis, the main conclusions can be obtained as follows: for a disadvantageous unfair-averse supplier, there is a unique optimal production quantity which is less than the traditional supplier's optimal production quantity and strictly decreases (decreases) with the disadvantageous unfair-averse coefficient (retailer's exogenous-force parameter), the wholesale price contract cannot coordinate the two-stage VMI supply chain; for a advantageous unfair-averse supplier; there is a unique optimal production quantity which is more than the traditional supplier's optimal production quantity and strictly increases (increases) with the advantageous unfair-averse coefficient (retailer's exogenous-force parameter), the wholesale price contract can coordinate the two-stage VMI supply chain under certain conditions. Finally, numerical examples are used to prove the findings.

Key words: VMI, supply chain coordination, unfair aversion, wholesale price contract