Metal Industry Supply Chain Buyback Contract Coordination and Income Distribution Based on Trade Credit

Abstract

This paper considers a metal industry supply chain consisting of one supplier and one retailer. When the supplier offers the trade credit to the retailer, their target profit and the supply chains profit will change. We develop the metal industry supply chains trade credit-based buyback contract model and analyze the buyback based on trade credits mechanism for improving the entire metal industry supply chain operational performance and for distributing the profit. We also derive the optimal contract parameters for the metal industry supply chain coordination and the conditions for profits rational allocation. Finally, a numerical example illustrates the conclusions.