Abstract
Aiming to find the effect of the same status entities’ horizontal coordination on supply chain, this paper studied the coalition stability of dealers in a two-stage supply chain with one supplier and multiple dealers. First, a vertical sequential game model is built, where the supplier is leader and the multiple dealers are followers. In the second stage of the game, multiple dealers face two selections: playing Nash game with each other or developing a coalition. Then, according to the results acquired by comparing the dealers’ profits which depend on their coalition situations, the criterion of coalition stability is developed. Finally, numerical simulation is used to verify the validity of the model, and some insights are obtained. For example, if the sensitivity coefficientTof the market price is fixed, dealers’ coalition tends to be stable with the increasing of the substitution ratekin a reasonable range; the supplier’s optimal wholesale price is constant with and without dealer’s coalition, but dealers’ coalition causes demand to decrease, which leads to the decrease of the supplier’s profit too. The result of this paper provides an important reference for the formation of dealers’ coalition in IT or automobile supply chain.
Highlights
With the development of market economy, many new-style supply chains come into being and become popular, such as automobile supply chain, IT supply chain, and franchise supply chain consisting of one supplier and multiple dealers
The vertical sequential game model which consists of one supplier as a leader and multiple dealers as the followers is described
Horizontal coalition stability of a two-stage supply chain, which consists of one supplier and multiple dealers, is studied in this paper
Summary
With the development of market economy, many new-style supply chains come into being and become popular, such as automobile supply chain, IT supply chain, and franchise supply chain consisting of one supplier and multiple dealers. Stability is the key of the horizontal coordination among entities in the supply chain and the increase of the supply chain profit. Cao et al studied the coordination mechanism of supply chain which has one manufacturer and multiple retailers in the case of the presence of disturbance of the cost and demand of product and obtained the optimal contract to distribute the profits [15]. The research on supply chain horizontal coalition is necessary Based on these observations, this paper studies the horizontal coalition stability of a two-stage supply chain consisting of a supplier and multiple dealers by using the game theory and acquires supply chain coalition stability criterion by comparing the profits of dealers with and without coalition. The main conclusions of this paper are verified by numerical simulation
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
