Abstract：Considering a supply chain with an upstream supplier and a downstream retailer who invests in innovation to improve customer value, this study examines the impact of supplier’s coordination on the innovation investment, profit and system’s benefit. It is confirmed that the ceiling wholesale price contract can partly coordinate supply chain decisions including the innovation investment, when the improvement of customer’s value is relatively hard-the innovation investment coefficient is low. And when the innovation investment coefficient is high enough, as customer value contributes more profit to supplier, supplier provides a lower the wholesale price than the ceiling price. In this situation, the retailer makes more investment on customer value, and the profit rises up. Then, the weaker supplier’s willing of coordination is, the easier ceiling wholesale price contract is invalid because of the change of innovation investment coefficient.
2016, Vol. 13 
