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Discrete Dynamics in Nature and Society
Volume 2013 (2013), Article ID 416790, 9 pages
http://dx.doi.org/10.1155/2013/416790
Research Article

Research on the Fresh Agricultural Product Supply Chain Coordination with Supply Disruptions

School of Management Science and Engineering, Shandong University of Finance and Economics, Jinan 250014, China

Received 16 December 2012; Accepted 8 February 2013

Academic Editor: Xiang Li

Copyright © 2013 Sun Guohua. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Abstract

This paper develops a dynamic model in a one-supplier-one-retailer fresh agricultural product supply chain that experiences supply disruptions during the planning horizon. The optimal solutions in the centralized and decentralized supply chains are studied. It is found that the retailer’s optimal order quantity and the maximum total supply chain profit in the decentralized supply chain with wholesale price contract are less than that in the centralized supply chain. A two-part tariff contract is proposed to coordinate the decentralized supply chain with which the maximum profit can be achieved. It is found that the optimal wholesale price should be a decreasing piecewise function of the final output. To ensure that the supplier and the retailer both have incentives to accept the coordination contract, a lump-sum fee is offered. The interval of lump-sum fee is given leaving both the supplier and the retailer better off with the two-part tariff contract.