Abstract
Presently, it is essential to increase customer service such that the Supply Chain Management (SCM) can earn more profit in a sustainable manner. In the supply chain, the manufacturer and the retailer are two players who try to maintain the joint profit of the Supply Chain (SC) without only thinking about their own respective profits. However, the retailer may not provide all information to the manufacturer. This research introduces the use of the advanced technology Radio Frequency IDentification (RFID) in a retailer’s shop to obtain exact information about customer demand. A consignment policy is used to increase the manufacturer profit, and a fixed fee is offered to the retailer to generate more profit in coordination with the manufacturer. This study is conducted with and without the effect of RFID to show the benefit of SCM even when the retailer is unreliable. Both models are solved using the classical optimization technique. Numerical findings prove that SCM can benefit from the outcome of this study even for unreliability. Coordination within SCM can be maintained for a long time by using the proposed recommendations of this study.
Highlights
In the area of Supply Chain Management (SCM), an unreliable player is an important issue.Before observing customer demand, management needs to decide how many products need to be stocked
If the retailer was not giving the proper information of the market demand, the manufacturer could utilize the proposed strategy to obtain the profit in a sustainable way
The advanced technology was utilized to ensure the profit of the manufacturer
Summary
In the area of Supply Chain Management (SCM), an unreliable player is an important issue. Management needs to decide how many products need to be stocked. There is lead-time demand uncertainty, and the stockholder faces a situation called understock or overstock due to the lack of proper information exchange between the Supply. The holding cost of the products is higher than usual. In this model, the retailer sends the wrong information to the manufacturer, such that understock or overstock happens. In this policy, two coalitions are contemplated—the consignee and the consignor. The manufacturer is denoted as the consignor, which means the upstream player, and the retailer is denoted as the consignee, which means the downstream player. Taleizadeh and Sadeghi [2] introduced a unified pricing strategy for sustainable development to increase market share using different incentives such as reverse SC, where both the retailer and manufacturer propose a reward scheme to the customer
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