Abstract: This paper studies a multi-supplier and single-retailer supply chain coordination model,in which the retailer leads the supply chain and proactively coordinates the up streamers'production behavior in order to lower their production cost. Additionally,the retailer would adjust his inventory level according to the market changes. With an analytical methodology under the Stackelberg Game,we derive the coordination equations and prove that the contracts we study are capable to realize a satisfying profit split between each party in the supply chain. The results show that the horizontal competition between suppliers can reduce the retailer's pressure for coordination and the retailer can achieve supply chain coordination through lower transfer payment.

Key words: supply chain coordination, contract mechanism, dominant retailer