Chinese Journal of Management Science ›› 2009, Vol. 17 ›› Issue (5): 88-95.
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ZHAO Xia, WU Fang-wei
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Abstract: Due to the effect of uncertain factors such as seasonal weather,the output of agriculture production is uncertain given certain agricultural inputs. This paper addresses the issue of coordinating agri-food chain with perishable goods by revenue-sharing contract when both output and demand random factor are uniform distribution. Under revenue-sharing contract,a supplier decides on agricultural input (e) and deliveries all goods with a price(ω)lower than its production cost per unit to the retailer while a retailer decides on the retail price (p) and return 1-Ф share (percentage) of its revenue to the supplier. Under such a contract,we analyze the basis of coordination of the chain and provide the relationship between ω and Ф teas well as the range of Ф A numerical example illustrates the correctness of our analysis. The results show that the revenue-sharing contract is able to coordinate the agri-food chain effectively and the optimal decisions of p and a are closely related to the demand price elasticity. The results also show the range of Ф is widen when the expected output increases.
Key words: perishable goods, agri-food chain coordination, revenue-sharing contract, stochastic output, stochastic demand
CLC Number:
F406
ZHAO Xia, WU Fang-wei. Coordination of Agri-food Chain with Revenue-sharing Contract under Stochastic Output and Demand[J]. Chinese Journal of Management Science, 2009, 17(5): 88-95.
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