Supply Chain Decisions of Fresh Products for Competitive Suppliers with Traceability Technology

¹ School of Management Shanghai University of Engineering Science Shanghai, China
² School of Management Shanghai University of Engineering Science Shanghai, China
³ School of Management Shanghai University of Engineering Science Shanghai, China

^a* Corresponding author: zhengqi@sues.edu.cn

Abstract

This paper focuses on the impact of traceability technology adoption on supply chain coordination. We consider a fresh product supply chain consisting of two suppliers and one retailer with centralized and decentralized decision-making. Considering the factors of the tag cost of traceability technology and the freshness of the product, two scenarios-with and without traceability technology are analyzed. The mathematical model is applied to investigate the impact of applying traceability technology on decision-making and profit of supply chain when two suppliers compete. The results show that: (1) the fresh product supply chain with the traceability technology is more profitable than the case that without the traceability technology; (2) when the tag cost of the traceability technology is within the threshold, the supplier’s profit decreases with the increase of the tag cost, and it is always greater than the corresponding profit when comparing with the case that without adopting the traceability technology; (3) if the tag cost of the traceability technology is too high, the retailer can use cost sharing or bargaining with the supplier to encourage him to implement the technology.