Sales Rebate Contracts in Fashion Supply Chains

Table 3

Expected profits under SCC, current practices, and no rebate case for sales-effort model.

	Companies
	MRS	MH	RX	SS	LS
SCC
𝐸[R’s profit]	232487.15	36975.36	17974681.83	70959.52	154588.22
𝐸[M’s profit]	118351.79	24464.38	8444736.48	57846.39	152942.49
𝐸[SC’s profit]	350838.94	61439.74	26419418.30	128805.91	307530.71
Order quantity	1353.30	1403.56	1354.30	1333.59	1422.78
u	697.06	187.74	50053.76	320.97	1354.69
u % (of p)	139.69%	234.68%	133.12%	168.93%	347.36%
T	1089.23	1077.02	1088.33	1074.88	1062.42
No rebate
𝐸[R’s profit]	229802.28	36530.45	17731826.88	69466.49	150259.02
𝐸[M’s profit]	111258.02	22410.15	8017041.98	53109.09	137199.75
𝐸[SC’s profit]	341060.30	58940.60	25748868.86	122575.58	287458.77
Order quantity	1135.29	1120.51	1145.29	1062.18	1063.56
Current practices
𝐸[R’s profit]	230186.22	36607.12	23183476.66	69311.06	157497.80
𝐸[M’s profit]	111343.54	22521.91	2826025.68	54917.56	130897.33
𝐸[SC’s profit]	341529.76	59129.03	26009502.34	124228.62	288395.13
Order quantity	1140.14	1130.14	1187.70	1098.05	1070.92
u	7.49	2.40	5640	19	7.80
T	1020	1050	0	1100	0
Difference between the sales-effort model and the no-sales-effort model; (sales-effort model minus no-sales-effort model)
SCC
𝐸[R’s profit]	127.85	45	3800	70	172
𝐸[M’s profit]	1233	405	34200	630	1548
𝐸[SC’s profit]	1370	450	38000	700	1720
T	22.7	27.21	19.47	22.71	25.8
No rebate
𝐸[R’s profit]	−1570	−150	−172000	−800	−2150
𝐸[M’s profit]	2940	600	210000	1500	3870
𝐸[SC’s profit]	1370	450	38000	700	1720
Current practices
𝐸[R’s profit]	−1459.21	−117.35	−2860.9	−578.55	−1916.09
𝐸[M’s profit]	2829.21	567.35	40860.89	1278.55	3636.08
𝐸[SC’s profit]	1370	450	38000	700	1720