Abstract Subject to financial constraints in supply chain, retailers’ purchasing decisions are discussed at different funding levels. By building supplier CVaR risk aversion contract model, we study the effectiveness of supplier buy-back commitments and the influence of supplier risk aversion for supply chain optimal decisions. After determining the important role of risk aversion degree for supply chain, supplier could set risk aversion mechanism to manage supply chain operations, leading to optimal combination of wholesale price and ordering quantity. During the process of setting up supply chain collaboration, there exits optimal buy-back rate and interest rate. Numerical examples further show that supply chain could ease financial constraints by designing rational supply chain contract mechanism.
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Received: 03 March 2016
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