Though it is an important means for enterprises to increase market demand and boost profits, trade credit can carry risks. Besides, risks also result from uncertain market demand. Decision-makers’ attitude towards risk will influence the decisions of enterprises, so it is meaningful to study the impact of risk preference on supply chain performance. This paper explores the effect of risk-averse preferences of the manufacturer or retailer on their delayed payment periods decision and utility when the dual-channel structure is adopted. Customer demands are uncertain and depend on the delayed payment periods that the manufacturer and the retailer may offer to them. Mean-variance model is used to describe the risks due to uncertain demand, and establishes supply chain utility models under four decision-making situations (both are risk-neutral; only the retailer is risk-averse; only the manufacturer is risk-averse; both are risk-averse). According to our study, supply chain members with higher risk aversion are more inclined to prolong delayed payment period. The retailers risk aversion is adverse for her utility, but beneficial to the manufacturers utility, thus a new coordination mechanism is proposed to achieve coordinate when only the retailer is risk averse. We prove that the contract can effectively improve the utility of the whole supply chain. This paper conduces to enrich the emerging literature on relating risk aversion preferences to trade credit period decision and coordination behavior under dual-channel environment.
Keywords: Supply chain management, dual-channel supply chain, delayed payment period, risk-averse preference, utility
@article{RO_2021__55_S1_S2879_0,
author = {Zhang, Chong and Wang, Yaxian and Zhang, Lifan},
title = {Risk-averse preferences in a dual-channel supply chain with trade credit and demand uncertainty},
journal = {RAIRO. Operations Research},
pages = {S2879--S2903},
year = {2021},
publisher = {EDP-Sciences},
volume = {55},
doi = {10.1051/ro/2020128},
mrnumber = {4223125},
language = {en},
url = {https://www.numdam.org/articles/10.1051/ro/2020128/}
}
TY - JOUR AU - Zhang, Chong AU - Wang, Yaxian AU - Zhang, Lifan TI - Risk-averse preferences in a dual-channel supply chain with trade credit and demand uncertainty JO - RAIRO. Operations Research PY - 2021 SP - S2879 EP - S2903 VL - 55 PB - EDP-Sciences UR - https://www.numdam.org/articles/10.1051/ro/2020128/ DO - 10.1051/ro/2020128 LA - en ID - RO_2021__55_S1_S2879_0 ER -
%0 Journal Article %A Zhang, Chong %A Wang, Yaxian %A Zhang, Lifan %T Risk-averse preferences in a dual-channel supply chain with trade credit and demand uncertainty %J RAIRO. Operations Research %D 2021 %P S2879-S2903 %V 55 %I EDP-Sciences %U https://www.numdam.org/articles/10.1051/ro/2020128/ %R 10.1051/ro/2020128 %G en %F RO_2021__55_S1_S2879_0
Zhang, Chong; Wang, Yaxian; Zhang, Lifan. Risk-averse preferences in a dual-channel supply chain with trade credit and demand uncertainty. RAIRO. Operations Research, Tome 55 (2021), pp. S2879-S2903. doi: 10.1051/ro/2020128
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