Abstract
In this paper, we want to investigate the retailer's inventory policy when the retailer maintains a powerful position in two-echelon supply chain. That is, we assumed that the retailer can obtain the full trade credit offered by the supplier yet the retailer just offers the partial trade credit to his/her customers under two-level trade credit situation. Then, we investigate the retailer's inventory system as a cost minimization problem to determine the retailer's optimal inventory policy in two-echelon supply chain. Finally, numerical examples are given to illustrate the results and to obtain managerial insights.
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