Abstract
This paper mainly proposes a coordination mechanism for a supply chain system containing multiple retailers and one supplier. According to the proposed coordination mechanism, lateral transshipments are performed among retailers while revenue-sharing contract is used to allocate the revenue caused by lateral transshipment. Meanwhile, buy-back contract is used to coordinate the retailer and supplier. We use a supply chain system with a supplier and two retailers as an example to demonstrate the effectiveness of the proposed coordination mechanism. The numerical example shows that the proposed coordination mechanism can effectively coordinate the discussed supply chain.
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