Reference no: EM133865193

Question

You have continued to gain understanding of the incentive misalignment problem in a decentralized supply chain. In this part of the Unit 4 Assignment, you will design a strategy to achieve supply chain coordination.

1. Pick a company of your interest and conduct some preliminary research. Describe its current practices in achieving supply chain coordination.

2. What recommendations would you make to this company for their supply chain management based on the tools and concepts learned in the supply chain analytics course? (strategy for tackling this issue:

1. vertical integration, or integrated planning,

2. Revenue-sharing contracts are another strategy for handling the incentive misalignment problem.

Under a revenue-sharing contract, the supplier offers a discounted wholesale price to the retailer in exchange for an 'x' percent cut of the revenue from the retailer. This strategy lowers the retailer's inventory risk, incentivizing the retailer to carry more inventory.

3. A third strategy for tackling the incentive misalignment problem is the use of buyback contracts. In such a contract, the supplier offers to buy back any unsold inventory from the retailer at a predetermined discounted price. Similar to revenue-sharing contracts, buyback contracts lower the retailer's inventory risk and incentivize the retailer to carry more inventory.)