Advanced OR and AI Methods in Transportation COMPARING TRANSPORT CONTRACTS IN A MULTI-PERIOD SETTING

The optimal contract and contract parameters are presented when a shipper and a capacitated transport service provider interact repeatedly to renew procurement agreements for one product in a multi period game. Three forms of contracts which enable credible information sharing are analyzed: a priceonly relational contract, a minimum purchase commitment or a quantity flexibility contract. A back-stop spot market for transport capacity is available to the buyer. Both transport spot price and received demand are dependent exogenous stochastic processes. Conditions for equilibria which do not depend upon any assumption of relative bargaining power between players are presented. If buyer and seller are offered the choice of transactional form, Nash equilibria require tighter conditions on contracts and parameters than previously envisaged in the literature. This paper meshes together different research strands: supply chain multi period game as well as recent supply chain contracts. Problems, which up till now were considered in isolation, are represented in one setting.