Trade credit financing for supply chain coordination under financial challenges: a multi-leader–follower game approach

Abstract This study is designed to solve supply chain inefficiencies caused by some members' financial problems, such as capital shortages and financing restrictions in a stochastic environment. To this end, we have established finance framework designing two novel coordinating contracts based on trade credit for different problem settings. These are modeled the form of multi-leader Stackelberg games that address horizontal vertical competition consisting multiple suppliers financially constrained manufacturer. However, previous studies literature addressed only simple competition, is, seller-buyer competition. proposed models, algorithms were developed combining population-based metaheuristics, Nash-domination concept, Nikaido-Isoda function. The results demonstrate can eliminate make large profit suppliers, well Furthermore, contracts’ analysis showed if manufacturer required settle its payments before end period, contract cannot coordinate because lack incentive suppliers. allowed extend chain. Finally, sensitivity indicate worse status manufacturer, more bargaining power determining parameters profit.