Supply Chain Coordination for False Failure Returns Avoidance
False failure returns are products that are returned by consumers with no functional defect. This type of returns can incurs significant cost for manufacturer and retailer, so returns avoidance is an important work for returns management. However, false failure returns avoidance requires manufacturer and retailers extra effort. For example, manufacturers design effort, pack effect and advertise effort, as well as retailers employee training investment, detailed description and perfect after-sales supports. In the decentralized decision-making channel without an effective incentive mechanism, each supply chain member attempts to optimize a part of the system, which results in sub-optimal performance. In this paper, we designed a double-side incentive mechanism to coordinate the supply chain in order to reduce false failure returns, which charges the manufacturer and retailer penalty for each false failure returns at first, then gives each one transfer payment to ensure nobody has been worsen off. We show that this contract can achieve channel coordination and a win-win outcome for both manufacture and retailer.
False failure returns Supply chain coordination Double-side incentive mechanisms
LIU Guo-shan LI Ming-fang
School of Business,Renmin University of China,Beijing,100872,China
国际会议
2008 International Conference on Risk and Relianility Management(2008风险与可靠性管理国际会议)
北京
英文
335-339
2008-11-10（万方平台首次上网日期，不代表论文的发表时间）