Supply Chain Decisions and Quantity Discount Coordination under Differentiated Logistics Services
SONG Jiezhen
HUANG Youfang
Abstract：In order to optimize the pricing decisions and increase the profits of the supply chain and all the participants in a supply chain containing differentiated logistics services, a coordination strategy based on quantity discount contract is designed.Firstly, based on the utility function, the consumers' choice be-havior is analyzed and the demand function for each delivery service derived.Then, based on Stackelberg game model, the equilibrium strategies in the decentralized condition are solved and compared in the cen-tralized condition.It is found that, in the decentralized condition, the product' s selling price is too high and the additional charge for the express delivery is too low, which hurts the consumers' utility and de-creases the supply chain' s overall profit by 25%.In order to reach the optimal performance in the centra lized condition, a pricing strategy for the logistics service provider ( LSP) is proposed based on quantity discount contract and related parameters designed.It is found that there are infinitely many quantity dis-count contracts which can coordinate the supply chain and improve the two parties ' profits in a certain range.In the end, a numerical study is conducted to simulate some of the coordination contracts and ana-lyze the effect of the retailer' s bargain ability on the profits of the LSP and the retailer.
Keywords：differentiated logistics servicesquantity discountsupply chain coordination
Publication Date：2016-01-01
Online Publishing Date：2025-08-15(First online date of this platform, not the publication date of the document)
Pages：8( 45-52 )