Decentralized Supply Chain Coordination with Revenue Sharing Mechanism: Transfer Pricing Heuristics and Revenue Share Rates
نویسنده
چکیده
A revenue sharing contract is one of the mechanisms that coordinate decision makers in a decentralized supply chain toward the consensual goal. The transfer prices between different echelons in the supply chain influence the total supply chain profits. The study aims to explore various transfer pricing heuristics on the supply chain coordination in terms of the supply chain profits and their interactions with the revenue sharing rate. A model is proposed for formulating the collaborative production and distribution planning in a decentralized supply chain with the revenue sharing mechanism. Various transfer pricing heuristics are used for identifying the resulted supply chain profits. Computation results that set the transfer prices as the variable costs of the products obtain better supply chain profits than other heuristics. Additionally, the revenue sharing rate interacts with transfer pricing heuristics.
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