Coordinating a three-level contract farming supply chain with option contracts considering risk-averse farmer and retailer.

ABSTRACT: We considered a three-level contract farming supply chain comprising a risk-averse farmer, a risk-neutral supplier, and a risk-averse retailer. The farmer plants and grows fresh agricultural products with yield uncertainty, the supplier is the leader of the supply chain and the designer of the contracts, and the retailer sells processed products with random demand. Under CVaR criterion, this paper discusses three option contracts between the supplier and the retailer, as well as wholesale price contracts or replenishment cost-sharing contracts between the supplier and the farmer. Results show that when the farmer is risk-neutral, option contracts with or without replenishment cost-sharing contracts can maximize the total profit and increase the profits of all members simultaneously. When t

SUBMITTER: Liao C 

PROVIDER: S-EPMC9956081 | biostudies-literature | 2023

REPOSITORIES: biostudies-literature