Contract Price Research Articles

Information Disclosure Decision for Tourism O2O Supply Chain Based on Blockchain Technology

(1) Background: With the development of blockchain technology and fierce competition between tourism platforms, tourism platforms can adopt blockchain technology to disclose product information to enhance their core competitiveness. As for a tourism O2O, i.e., online to offline, supply chain, the tourism platform sells the product online, and the tour operator provides services offline. (2) Methods: We establish a game theory model and study the optimal strategies of supply chain members in two scenarios (decentralized and centralized) when the online platform does not adopt or adopts blockchain technology. Then, we introduce a two-part tariff contract for coordination. Furthermore, we discuss the impact of the cost of adopting blockchain technology, disclosing information and the proportion of information-sensitive consumers on the optimal strategies. (3) Conclusions: When the costs of adopting blockchain technology and information disclosure are low, if the proportion of information-sensitive consumers is large, adopting blockchain technology is beneficial to supply chain members. Compared with a wholesale price contract, a two-part tariff contract can encourage the platform to improve information disclosure quality, so the tour operator can adjust their cooperation contract to achieve Pareto improvements. Under a two-part tariff contract, the tourism platforms are more likely to disclose information and can effectively regulate the operational performance of the tourism O2O supply chain.

Coordinating double-level sustainability effort in a sustainable supply chain under cap-and-trade regulation

In recent decades, due to the growing sustainable development concerns, the supply chains members, such as manufacturers and retailers, are interested in investing in environmental sustainability and social sustainability issues to gain more market share in today’s competitive business environment. This paper contributes to the literature by proposing double-level sustainability effort in a sustainable supply chain consists of one manufacturer and one retailer under the cap-and-trade regulation. The manufacturer invests in the technology to reduce carbon emissions and improve the quality of products. On the other hand, the retailer invests in green effort while decides on its periodic review order-up-to-level replenishment policy. Under such a case, both the manufacturer’s and the retailer’s decisions not only affect their individual profitability but also impact on the whole supply chain performance and sustainability level. Using game-theoretic mathematical modeling, the double-level sustainability effort is first analyzed under the decentralized and centralized structures. Then, a compensation-based wholesale price contract is introduced to coordinate the sustainable supply chain under the cap-and-trade regulation. The surplus profit obtained under the coordination plan is shared between the manufacturer and retailer depending on their bargaining power. The data generated based on the assumptions of a pharmaceutical case study is applied to indicate the applicability of developed models. The results illustrate that the developed coordinated system simultaneously enhances the whole sustainable supply chain performance from the social, environmental, and economic points of view.

Quadratic quantity discount contract under price-dependent demand and consumer returns

This study introduces a new type of supply contract, the quadratic quantity discount contract, whose average transfer payment is a quadratic function. Thus, both the total and average quantity discounts increase nonlinearly in order quantity, unlike the typical linear quantity discount contract, whose total discount is nonlinear but average payment is a linear function of order quantity. We reveal the quadratic quantity discount contract’s unique properties by comparing it with linear quantity discount and wholesale price contracts. Our investigation, conducted in basic and closed-loop supply chain situations, reveals the potential of the quadratic quantity discount contract to be considered a serious choice for supply chain managers in various situations. Specifically, we reveal that the quadratic quantity discount contract always coordinates the supply chain, achieving the first-best supply chain profit while always enhancing the profits of all players. This is the most important difference from the typical linear quantity discount contract that entails a profit distribution problem and bargaining power issues. Further, unlike other contracts, its profit improvement performance is predictable; moreover, it offers the acceptable wholesale price with an additional nonlinear average discount. However, when the supplier can exercise its power and only considers its own profit, the typical linear quantity discount contract can be considered the better option, as it produces superior profits for the supplier, but the profits of the retailer and supply chain are sacrificed in this case. If the supplier considers the supply chain’s long-term health and wants voluntary compliance from other players, the quadratic quantity discount contract is the optimal choice.

Procurement of Goods and Services in Logistics and Procurement Devision of PT XYZ

This study aimed to determine the standard of the procurement process for goods and services in the logistics and procurement sector of PT XYZ. In a company management, the quality and quantity of goods and services must be maintained in line with the rapid level of company competition. Qualitative descriptive method was used in this study. Observation, interview, and literature study methods were carried out for data collection. PT XYZ which is engaged in information and technology as well as telecommunications has a need for goods and services that are in accordance with the quality, quantity, time, and price. There are two types of contracts for the procurement of goods and services at PT XYZ, those are Unit Price Contract (UPC) which means a contract for the procurement of goods and or services by setting the unit price for the goods and services to be purchased and the unit price is applied in a certain period and carried out through a Letter of Order. The second contract type is Turnkey Contract which means a contract for the procurement of goods and or services for the completion of all work within a certain time limit.
 Keywords – procurement, goods, services, logistics

Survey of biosimilar adoption across oncology pharmacy practices.

e18813 Background: Use of biosimilars is an effective strategy in expanding access to care and lowering healthcare costs. Literature about the successes, challenges, and best practices of biosimilar adoption in oncology is limited. We aim to describe the current state of biosimilars in oncology practices and barriers to adoption. Methods: A 40-question survey was developed to gather information regarding biosimilar use in the following areas: formulary management, product usage, policies, technology, safety, and education. The following biosimilars were evaluated: bevacizumab (B), filgrastim (F), epoetin (E), infliximab (I), pegfilgrastim (P), rituximab (R), and trastuzumab (T). The survey was distributed to Hematology/Oncology Pharmacy Association members. Results: A total of 179 surveys were initiated, with a completion rate of 31%. Six surveys were removed due to duplication, resulting in 50 unique surveys with 21 responses (42%) from NCI-designated comprehensive cancer centers. Inpatient formulary decisions were driven by acquisition cost followed by reimbursement. In the outpatient setting, equal consideration was given to acquisition cost and reimbursement for formulary decisions. Thirty-two percent of institutions restricted biosimilars to their FDA approved indication. Sixty-six percent of institutions had a biosimilar interchangeability policy in place. For the corresponding reference products, overall average utilization of biosimilars was B 74%, F 88%, E 82%, I 57%, P 52%, R 73%, and T 71%. More than 90% of institutions had a preferred biosimilar on formulary. Based on the results, 72% stated payors specified the selection of biosimilars, and 76% stated payor reimbursement limited ability to participate in contract pricing. Insurance reimbursement was recognized as the main barrier to adoption (Table). Medication errors related to biosimilar use were reported by 26% respondents, with the most common cause listed as communication. Thirty-six percent of institutions provided education on the general use of biosimilars and 38% had biosimilar products in treatment specific education. Conclusions: Biosimilar adoption is consistent across responding institutions, with noted utilization shift towards biosimilar products compared to reference. Decisions for biosimilar adoption are made based on cost and reimbursement. Opportunities exist in the collaboration of health systems and payors to align formularies and promote safe and cost-effective care for their members.[Table: see text]

The choices of channel structures and information strategies in a supply chain

This study considers the choices of channel structures and information strategies in a supply chain with demand uncertainty. The results show the following: (1)The decentralized channel structure dominates the centralized channel structure when the information strategy is given. (2)Information sharing by the downstream rival is always beneficial to the vertically integrated producer but is not necessarily detrimental to itself. In particular, information sharing increases the downstream rival’s profit in the centralized channel structure when the demand signal is relatively accurate. (3)The vertically integrated producer always benefits from the increase in forecast accuracy and the downstream rival may be worse off in some situations, which provides a theoretical ground for the “accuracy trap.” In addition, the discussions of the wholesale price commitment and the uniform pricing contracts show that the wholesale price contracts can influence the information sharing conditions of the downstream rival and the effects of strategic decentralization, eventually influencing the equilibrium strategies of channel members.

Pareto optimality and contract dependence in supply chain coordination with risk‐averse agents

In recent years, research on supply chain coordination (SCC) with risk‐averse agents has received much attention. Previous studies are primarily concerned with the coordination of a single manufacturer–single retailer supply chain using different definitions of SCC. What is lacking is a comprehensive analysis of the achievability of SCC. In this paper, we provide a systematic analysis of SCC with risk‐averse agents. We see that three definitions of SCC have been proposed in the literature to investigate SCC with risk‐averse agents, among which the one based on Pareto optimality (PO) stands out. Here we explore the challenges of using the PO criterion. Specifically, we first examine the standard two‐agent supply chain under the mean–variance (MV) and mean‐downside‐risk (MDR) objectives. What we find is that the achievability of PO depends on the contract type. The wholesale price contract even with a side payment may not lead to PO. Also, unlike under MV where risk sharing is Pareto optimal, we observe that the least risk‐averse agent must take all the risk to achieve SCC under MDR. Importantly, we extend our analysis to multiretailer, multimanufacturer, and multitier supply chains. In each case, we characterize the efficient Pareto‐optimal manifold in the multidimensional space and design coordinating contracts that result in Pareto‐optimal actions acceptable to all agents. We also discover that identifying PO across all the contract forms is difficult when some other risk‐aversion criteria are considered. We conclude by providing suggestions and methods for SCC when we are unable to identify PO.

Hybrid equity swap, cap, and floor pricing under stochastic interest by Markov chain approximation

Hybrid equity-rate derivatives are commonly traded between financial institutions, but are challenging to price with traditional methods. Especially challenging are those contracts which involve an explicit interest rate (fixing) dependence in the cashflows, which stretches typical measure-change approaches beyond their practical limit. We introduce a framework for pricing equity swaps, equity cap/floors, and other hybrid derivatives under general stochastic short-rate models with a correlated equity. By utilizing the machinery of Continuous Time Markov Chain (CTMC) approximation, and a decoupled representation of the equity-rate model, we derive semi-closed-form approximations for the hybrid contract prices based on a regime-switching model and prove theoretical convergence. The numerical implementation of the method is fast and very accurate, achieving superquadratic convergence in numerical experiments. The framework also provides a practical alternative to traditional approaches such as trees for pricing bonds and bond options under short-rates models which lack closed-form solutions.

Application Analysis: Unit Price Contract System In The Procurement Of Goods And Services At Pt Xyz

This applied research describe how the process of procurement of goods and services at PT. XYZ. This research is descriptive qualitative research where the method used is a literacy study to find out the previous research, then observation, interview, and observation of document data. Selection of good and services providers at PT. XYZ is done by way of Unit Price Contract (UPC). The stages of the procurement of good and services in UPC system include two stages, at the first stage is carried out to select the procurement participant administratively. The second stage is determining the winner of the UPC partner. In its implementation, the procurement of good and services at PT. XYZ rarely find significant obstacles.

Contract Design of Logistics Service Supply Chain Based on Smart Transformation

A logistics service integrator (LSI) usually requires a logistics service provider (LSP) to carry out smart transformation in order to improve the level of logistics service. However, LSP’s smart transformation faces uncertainty in terms of investments and income, which seriously hinders LSP’s enthusiasm for logistics service innovation. In this paper, we construct a logistics service supply chain (LSSC) consisting of an LSI and an LSP to explore the incentive mechanism for LSPs to undergo smart transformation. As a benchmark for comparison, we first obtain the equilibrium results under centralized decision making and wholesale price (WP) contracts. Then, cost-sharing (CS), revenue-sharing (RS), and cost sharing–revenue sharing (CS-RS) hybrid contracts are proposed. It is found that when the CS coefficient is in a certain interval, the CS contract can increase the profit of LSI and the smart level of logistics service, but it will decrease the profit of LSP. With the exception that the wholesale price of logistics services will decrease, the equilibrium results under the RS contract and WP contract remain consistent. Only the CS-RS hybrid contract can achieve the perfect coordination of LSSC. In addition, by conducting numerical analysis, we find that the enhancement of the smart effect can encourage LSP to improve the smart level and increase the overall revenue of LSSC. To the best of our knowledge, this paper is the first study to explore the incentive mechanism between LSI and LSP in the context of logistics service smart transformation. Our findings guide the LSI in implementing an effective contract.

Economics of Crop Rotations With and Without Carinata for Sustainable Aviation Fuel Production in the SE United States

In 2019, the aviation sector in the United States emitted 255 million metric tons of carbon dioxide (CO2) emissions, i.e., about five percent of the total domestic CO2 emissions from the energy sector. The sustainable aviation fuel (SAF) derived from carinata (Brassica carinata) could reduce CO2 emissions of the aviation sector in the United States. Therefore, it is important to estimate changes in farm economics with and without carinata for ascertaining its production feasibility. In this context, the current study first assesses a combination of 12 popular rotations of corn, cotton, peanut, and soybean with winter crops of winter wheat and carinata in South Georgia over 4 years. Then, the net present values (NPVs) of 292 feasible cropping systems over 4 years are calculated. Finally, this study develops a risk model for ascertaining the probability distributions of NPVs for selected cropping systems subject to uncertainties related to prices and yields of summer and winter crops. Carinata in the corn-corn-soybean rotation has the highest NPV ($2,996/ha). The least risky rotation is cotton-cotton-peanut, with a 58.9% probability of a positive NPV. Carinata can decrease the risk level of crop rotations by 8.1%, only if a contract price of $440.9/t is offered. Therefore, a risk averse, risk neutral, or risk acceptant farmer can potentially include carinata in the rotation. Overall, carinata would increase the profitability of farm operations and decrease risk in the SE United States, and therefore, a high likelihood exists, that farmers would adopt it for meeting the growing demand for SAF in the United States.

Обліковий аспект управління державними фінансами у сфері науки

The article is devoted to the study of key approaches to the creation of a modern mechanism of public finance management in the field of science in Ukraine on the basis of accounting information about the real cost of research and development. The state of financing the sphere of science is analyzed, and negative trends are shown in the structure of public expenditures that do not contribute to the development of the scientific potential of our state. It has been determined that financing of subjects of scientific - technical activities should be carried out on the basis of a reliably determined cost of public services provided by them. It has been substantiated that the cost price as an indicator of the volumes, directions and quality of the use of budgetary funds should become the basis for determining the amount of government funding and establishing a contractual price for research and development. It has been shown that in the conditions of the declared European integration direction of the development of domestic science, Ukrainian subjects of scientific and scientific-technical activities function in the absence of a sectoral normative legal act on the formation of the cost price of scientific research and scientific-technical (experimental) developments. It is shown that in order to implement state policy to enhance domestic scientific and scientific -technical activities and integration into the European Research Area, it is necessary to agree on approaches to mechanisms for the distribution of budgetary funding and develop a unified regulatory framework for planning, accounting for research and development and calculating thе cost price. This will contribute to the formation of unified principles for determining the cost of scientific re and scientific - technical (experimental) developments to create a modern effective mechanism for managing public finances in the field of science.

Effects of asymmetric cost information on collection outsourcing of used products for remanufacturing

Due to environmental and economic benefits from remanufacturing as well as an existing or potential take-back regulation, a manufacturer often implements remanufacturing, but it often delegates a third-party (3P) to collect used products. However, the collection efficiency is the 3P’s private information while the prior distribution of the 3P’s collection efficiency is possessed by the manufacturer. To maximize its expected profit, the manufacturer can design nonlinear pricing contracts to stimulate the 3P to select one that corresponds to its true type, where the nonlinear pricing contracts consist of the wholesale price and the collecting quantity. Specifically, our modeling analysis reveals that asymmetric information can result in the downward distortion of quantities collected by the 3P with low collection efficiency, whereas the quantities collected by the 3P with high collection efficiency remain unchanged. Besides, faced with information asymmetry and collection outsourcing, the manufacturer may also bring the new product quantity down if the 3P has low collection efficiency. Moreover, the take-back regulation will indirectly reduce consumer surplus, and this negative effect will be amplified by asymmetric information.

Omni-channel retail operations in the presence of strategic customers: The benefit of inventory commitment.

This paper studies the impact of strategic customer behavior on retailers’ omni-channel strategies. Customers in the market are classified into strategic omni-channel customers and myopic B&M (brick and mortar) store customers. The retailer firstly charges a full price but will then salvage the leftover inventory at a lower price (markdown policy) for strategic omni-channel customers after the customers’ demand is realized. The strategic omni-channel customers choose purchase timing to maximize their own expected profit. While, the myopic B&M store customers do not choose purchase timing. By characterizing rational expectation equilibrium, we find that the inventory level under markdown policy is higher than that in the classic model where no markdown policy is implemented. Also, the policy will transfer more strategic customers to the online channel to buy at full price so that the retailer will benefit from it. Besides, inventory commitment policy can further increase retailer’s profit based on markdown policy. In addition, we extend the model to the supply chain and present the contrasting view that the total profit of the decentralized supply chain under the wholesale price contract is higher than that of the centralized supply chain. The influence of strategic customer behavior and system parameters on the retailer’s optimal decision is discussed through numerical study.

Comparative Cost Analysis of Single-use Sterile versus Reprocessed Distal Radius Volar Plate Sets.

With the rise in distal radius fracture (DRF) incidence and treatment through open reduction internal fixation, there are increasing concerns in the current medical cost containment climate. To help reduce costs, manufacturers are introducing sterile packed kits. The purpose of this study is to compare the costs of the single use kit (SK) against conventional reprocessed DRF surgical sets (RS). A four-year retrospective review at three surgical centers was performed to determine a company's RS average sterilization and processing costs. RS instrumentation cost was estimated by straight-line depreciation from the original purchase price. RS implant costs were calculated from the list price. SK list cost was obtained from the same company. Incidence of surgical delays was estimated by a survey of 23 hand surgeons and cost of delays was obtained from surgical center reports. Sensitivity analysis on delay frequency was performed to assess a range of overall costs. OR delays were estimated at one out of 100 cases, with an average cost of $11 per case. For RS, average instruments, implants, and sterilization costs per case was $47, $2882, and $39. The total RS cost of $2,978 and the SK was $1,667 with a difference of $1,313 per case. RS was found to cost $1,313 more per case than the SK in an ambulatory surgical setting and potentially more cost effective. Ultimately, pricing is highly variable at each center based on negotiated and contractual pricing.

The concept, indicators and criteria of risk tolerance of the system of material and technical support to the combat readiness of the armed forces

Subject. The system of material and technical support to the combat readiness of the Armed Forces of the Russian Federation plays an extremely important role in ensuring the defensive ability of the country. The article offers indicators and criteria to assess risk tolerance of the logistics support to the Armed Forces of the Russian Federation, which act as a solid foundation for theoretical and methodological framework development. Objectives. Our aim is to develop a concept, indicators and criteria for risk tolerance of the logistics support to the combat readiness of the Armed Forces. Methods. The study employs normative and integrated approaches to investigate the efficiency of public funds utilization in ensuring the combat readiness of the Russian Federation, and methods of retrospective, systems, functional, and structural analysis, observation, classification, grouping, sampling, comparison, generalization, dynamic analysis. Results. The paper offers a set of measures and recommendations aimed at improving the efficiency of budgetary funds utilization in the development of armaments and military and special purpose equipment, by assessing the risk tolerance of the system of logistical support to combat readiness of the Armed Forces. Conclusions. The Russian Federation needs a comprehensive program for assessing the risks and risk tolerance of the logistics system to support the combat readiness of the Armed Forces from the stage of substantiating the initial contract price to the stage of serial production.

Agricultural Supply Chain Coordination under Weather-Related Uncertain Yield

In the context of agriculture, we focus in this paper on a two-echelon supply chain consisting of a supplier facing weather-related yield uncertainty and a retailer facing market-linked demand uncertainty. We mainly investigated how the randomness of yield and demand influences the profit of the supply chain members and the performance of the entire supply chain. We adopted an additive random yield model to capture the effect of uncontrollable weather factors on crop yield. For the case where a wholesale price contract fails to achieve coordination, we propose a revenue-sharing contract with a new structural arrangement and explore its influence on the contract coordination ability. In the revised contract, the retailer purchases all the actual output from the supplier instead of an order quantity; thus, the retailer shares yield risk with the supplier. To look at the implications in detail, we conducted a numerical analysis where the uncertain yield of maize crops originates from the fluctuating rainfall; the results indicate that the revised revenue-sharing contract can achieve supply chain coordination, and all the members improve their profit. This paper shows that by redesigning the contract structure, the classical revenue-sharing contract still has the coordinating ability in the presence of simultaneous yield and demand uncertainties.

Ascertaining land allocation decisions of farmers about the adoption of carinata as a potential crop for sustainable aviation fuel production in the Southern United States

AbstractThe adoption of a bioenergy crop is affected by various factors, including but not limited to the characteristics of farmers, farm economics, market forces, and physical environment. This study develops a spatially explicit agent‐based model for ascertaining the adoption rate of carinata (Brassica carinata) among the farmers in the Little River Experimental Watershed located in the southern state of Georgia in the United States. Each farmer's adoption behavior is modeled using the profitability difference between traditional crop rotations (with and without carinata at different contract prices), the adoption rate of neighboring farmers, and their land allocation decisions from managing a risky portfolio of enterprises. Carinata production in the winter season once every 3 years has no conflict with the most profitable and popular traditional row crop rotations, such as cotton‐cotton‐cotton and cotton‐cotton‐peanut, to a larger extent. The results show that 28% and 85% of farmers in the watershed will adopt carinata after 33 years at a contract price of $13/bushel (bu) under two different assumptions of low (2.5%) and high (5%) initial neighborhood adoption rates. The proportions of land allocated to carinata to the total farmland under field crops are 38% and 85% after 33 years under the same low and high neighborhood adoption rates, respectively. Our results suggest that fixing the appropriate contract price of carinata will bring additional profits to farmers without any significant foreseeable agronomic risks, thereby increasing the adoption rate of carinata at a regional level.

Efficiency of Black and Scholes Model for Pricing Options at Indian Stock Market

Black and Scholes model was developed for valuing the options in derivatives market in the year 1973. This model became the prime tool for pricing options but because of its deficiencies it forced researchers to find out new model for pricing options (Rubinstein, 1985; Hull and White, 1987; Wiggins, 1987; Dumas, Fleming and Whaley, 1998). Option pricing is proven to be very challenging task during high volatility situations whereas Black and Scholes option pricing model is not proven a successful predictor for determining approximate price of the options. Even empirical evidences support that Black and Scholes model produces some biasness in estimating the prices. The main objective of this paper is to find out the efficiency of the Black and Scholes option pricing model for predicting the option prices at Indian Stock Exchanges for which data set from Indian Stock Exchanges will be chosen, market price of option contracts are considered as sample for the year 2008-2015. The actual market price will be compared with the price derived with the help of Black and Scholes model formula.

Pricing and Contract Coordination of BOPS Supply Chain Considering Product Return Risk

This study proposes a BOPS (buy online and pick up in store) model for a two-echelon supply chain, considering the product return risk to reach an equilibrium result of two omni-channel integration modes, managed by the manufacturer or the retailer, respectively. Furthermore, this study analyzes the impacts of the service cost coefficient and the consumer loyalty of the offline channel on the optimal price, service decision, and profit of different integration modes. This study also compares the profits of enterprises under centralized and decentralized decisions. The results show that centralized decision making can improve the service level of the SA (Store Assistance) effort and the sustainable performance of the supply chain. Whether the BOPS channel is managed by the manufacturer or retailer, the service cost, the product return rate, and the offline channel consumer loyalty have an impact on the decision of product sale price, wholesale price, and SA effort service level. Offline customer loyalty is less sensitive in the BOPS channel managed by the retailer than that managed by the manufacturer. It is suitable for the manufacturer to manage the BOPS channel when offline customer loyalty is low. Otherwise, it is appropriate for the retailer to manage the BOPS channel. The profit of the supply chain under the decentralized decision is less than that under the centralized decision. When executing a wholesale price contract, different omni-channel integration modes can alleviate the double marginalization effect. It can fully coordinate the supply chain members, motivate retailers to improve the service level of the SA effort, and realize Pareto improvement to support supply chain sustainability.