Decisions of dual-channel fresh agricultural product supply chains based on information sharing

Abstract

PurposeThis paper studies the optimal decision-making and coordination problem of a dual-channel fresh agricultural product (FAP) supply chain. The purpose is to analyze the impact of information sharing on optimal decisions and propose a coordination mechanism to encourage supply chain members to share information.Design/methodology/approachThe two-echelon dual-channel FAP supply chain includes a manufacturer and a retailer. By using the Stackelberg game theory and the backward induction method, the optimal decisions are obtained under information symmetry and asymmetry and the coordination contract is designed.FindingsThe results show that supply chain members should comprehensively evaluate the specific situation of product attributes, coefficient of freshness-keeping cost and network operating costs to make decisions. Asymmetric information can exacerbate the deviation of optimal decisions among supply chain members and information sharing is always beneficial to manufacturers but not to retailers. The improved revenue-sharing and cost-sharing contract is an effective coordination mechanism.Practical implicationsThe conclusions can provide theoretical guidance for supply chain managers to deal with information asymmetry and improve the competitiveness of the supply chain.Originality/valueThis paper combines the three characteristics that are most closely related to the reality of supply chains, including horizontal and vertical competition of different channels, the perishable characteristics of FAPs and the uncertainty generated by asymmetric demand information.