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| Selection of Intermediate Products Trading Contract from the Perspective of Bargaining Power |
| LI Wei |
| Chinese Academy of Social Sciences, Beijing, China |
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Abstract In the context of competitive supply chain, the paper establishes a corporate trading contract decision model, examines the selection of intermediate product trading contracts, and discusses the impact of trading contract selection on the overall profit of the supply chain and the corresponding coordination mechanism. The study shows that contract type is determined by the contract-type decision rights and the bargaining power of both parties. In the case where the contract-type decision rights is exogenous and endogenous by bargaining powe, the manufacturer and the retailer will choose two-part tariff or linear pricing contracts according to the bargaining power. The choice of trading contracts may result in a decline in the overall profit of the supply chain and a contract conflicts at the enterprise-supply chain level. This paper identifying the conditions under which such contract conflicts occur, and designing a compensation mechanism based on bargaining power to resolve this conflict.
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Received: 18 February 2019
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