Decisions and coordination of retailer-led fresh produce supply chain under two-period dynamic pricing and portfolio contracts

Abstract

Fresh agricultural produce is almost the staple food and necessity of people's daily diet all over the world. However, natural perishability and freshness affect the demand for fresh agricultural produce. Due to the change of freshness, the retailer has to adopt a multi-period dynamic pricing strategy to deal with unsold products. The research object of this paper is the retailer's two-echelon supply chain of fresh agricultural produce, and the aim is to achieve the optimal two-period coordination and ordering through options and wholesale contracts in the supply chain. In the case of two-period pricing, we find that the optimal wholesale order quantity increases with the decline of the price in the first period and tends to be stable with the decline of the price in the second period. In contrast, the price change in the first period has a greater impact on the retailer's optimal order quantity. The profits of both the retailer and the supplier increase significantly with the increase of the price in the first period, while the impact of the change of the price in the second period is not obvious. Meanwhile, decentralized decision-making can only be coordinated in the supply chain through the original option contract at the first-period price. In the second period, the cost-sharing contract is introduced to coordinate the supply chain, increase orders, and increase the profits of both the retailer and the supplier. These findings are of great significance for both the retailer and the supplier in the multi-period dynamic pricing of fresh produce under the option contract.

Mixed Integer Robust Programming Model for Multimodal Fresh Agricultural Products Terminal Distribution Network Design

“…The production operation problem induced by the increase in demand has received extensive attention from academia and industry [1]. In recent years, the transportation network of fresh agricultural products has undergone great evolution [2]. Low efficiency and high cost of distribution have always been problems in the logistics industry, especially in the terminal distribution process [3,4].…”

Investment strategies and coordination for green food supply chain: a further research considering the inputs of the blockchain-based traceability system

“…Many contracts were put forward to achieve a GFSC coordination in different environment. Common contracts used to coordinate the food supply chain were cost-sharing, benefit-sharing and risk-sharing (Ghosh and Shah, 2015; Yl et al ., 2021; Yan and Han, 2022). Such as, cost-sharing contract was used to coordinate GFSC considering consumers' sensitivity to the increase of food green degree (Zhu et al ., 2018).…”