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| Replenishment Policy of Supply Chain Coordination via Revenue Sharing with Risk Aversion and Promotional Advertisement |
| DAI Jiansheng，YU Shiyan |
| Kunming University of Science and Technology, Kunming, China |
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Abstract This study takes CVaR method to investigate supply chain coordination viaa revenue-sharing policy, where the retaileris is risk averse, and can improve demand of commodity through promotional advertisements, and exert emergency ordering after demand realization.From the perspective of risk aversion, it characterizes the conditions for supply chain coordinationto be achieved, and depicts relationships among policy parameters and feasible area of the coordination policies. It shows that supply chain coordination is achieved more likely with replenishment ordering than without replenishment ordering. What’s more, the higher the rate of delayed supply is, the smaller the salvage value is,and the lower the emergency production cost is, the more likely the supply chain coordination will be realized. In order to achieve channel coordination, there must exist the following relationships among the policy parameters: Both purchase price and replenishment price are linearly increasing in revenue sharing ratio of the retailer,and linearly decreasing in advertising cost allocation ratio of the retailer. In particular, changes of the parameters such as risk aversion of the retailer, delayed supplyrate, salvage value and emergency production cost, only affect the replenishment price, but have nothing to do with the purchase price.
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Received: 13 January 2020
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