Abstract
In a two-level supply chain that includes one supplier and one capital-constrained retailer, this paper investigates a new bank financing model (Model N), in which, the supplier requires the retailer to order a quantity that is not less than a specified minimum ordering quantity (MOQ), rebates the per unit excess that sells over the MOQ, and promises to provide a partial warranty for the bank credit risk if the revenue is below the bankruptcy level of the retailer with the MOQ. This study shows that retailer’s optimal order quantity increases with MOQ level and decreases with rebate rate, while supplier’s optimal wholesale price shows an opposite tendency. Compared to the traditional bank financing model (Model T), the model N with an appropriate rebate contract will result in a larger order quantity of retailer. Furthermore, model N would benefit the entire supply chain and a Pareto zone of MOQ (or rebate rate) exists, in which, model N outperforms model T for each player. The numerical experiments are performed to illustrate that with increasing the marginal production cost of supplier, the MOQ level is decreasing while rebate rate is increasing in the Pareto zone.
Funder
Natural Science Foundation of China
Foundation of Philosophy and Social Science Research in Colleges and Universities in Jiangsu Province of China
2019 Qinglan Project of Jiangsu Province in China
Foundation of Audit Information Engineering and Technology Collaborative Innovation Center in Nanjing Audit University
Priority Academic Program Development of Jiangsu Higher Eduction Institutions
Subject
Management Science and Operations Research,Computer Science Applications,Theoretical Computer Science
Cited by
5 articles.
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