Coordination of a fashion supply chain with demand disruptions

Abstract

In this paper, we consider supply chain coordination with a revenue sharing contract (RSC) and a linear quantity discount contract (LQDC) in a fashion supply chain with demand disruptions. The situation without demand disruptions is considered as the benchmark. In the benchmark, we find that, the RSC fails to coordinate the supply chain while the LQDC does. We also find that demand disruptions can promote supply chain coordination. We then find that, in some cases, the RSC (LQDC) fails to coordinate the supply chain whereas the LQDC (RSC) can do so.