Multi-level Supply Chain Coordination with the Possibility of Credit Purchase

Today, with increased focus on sustainable supply chain management companies have found that the cost of the supply chain and inventory could be efficiently managed through greater cooperation and better coordination. This study provides a model for coordinating a three-level supply chain (suppliers, manufacturer and buyer) and the mechanisms of coordination in the supply chain is based on credit purchases. In this purchase the suppliers enables the manufacturer and also the manufacturer allows the buyer to pay his debt after the permissible delay and during this period the buyer does not pay any interest but after the end of the permissible time,he has to pay interest per late day. The permissible time for payment of debts is considered as a decision variable in the model. In the end, the overall costs of the supply chain are compared with and without delay and sensitivity analysis is conducted on the parameters.

Keywords:

Coordination , supply chain management , permissible delay in payment