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Coordinating a three level supply chain in a price-sensitive demand environment

Author

Listed:
  • Santanu Sinha
  • S.P. Sarmah

Abstract

Supply chain coordination is one of the important issues in supply chain management. In the literature, quite a good number of models have been developed to coordinate two-stage supply chain under different situations. However, there has been little research on modelling supply chain coordination in more than two stages. In this paper, we have developed a three-level coordination model with price sensitive market demand and variable production rate of the manufacturer. An all-unit quantity discount scheme is used to coordinate the entire channel and a mechanism is proposed to share the coordination benefit based on the relative bargaining power of each channel member. Finally, a numerical study is carried out to illustrate the efficacy of the model.

Suggested Citation

  • Santanu Sinha & S.P. Sarmah, 2010. "Coordinating a three level supply chain in a price-sensitive demand environment," International Journal of Operational Research, Inderscience Enterprises Ltd, vol. 9(2), pages 205-226.
    • Handle: RePEc:ids:ijores:v:9:y:2010:i:2:p:205-226
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