Journal of Chemical and Pharmaceutical Research (ISSN : 0975-7384)

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Original Articles: 2014 Vol: 6 Issue: 7

Revenue-sharing contract mechanism in n-echelon Green supply chain

Abstract

The revenue-sharing contract mechanism for n-echelon supply chain in green environment is researched in this paper. It analyzes the decision under the n-echelon green supply chain in three scenarios, namely, the decentralized decision, centralized decision and revenue-sharing contract, and their optimal policies are also proposed. Further, a numerical case is given to validate the models and conclusions. It is shown that with the raising green degree the markup rate of the green product will increase, the optimal order quantity of retailers in the green supply chain will decrease, and meanwhile, the profits for each member will firstly decrease and then increase. In addition, the profits for each member in revenue-sharing contract can be improved signally compared to in decentralized decision.