Supply Chain Coordination Response to Unconventional Emergencies Under Buy Back Contract

This paper investigates whether the simplest two-stage supply chain can be coordinated to respond to unconventional emergencies under the buy-back contract. The study regarded the large scale fluctuations of random market demand and the retail price fluctuating with changes in supply and demand of the market as basic features. Based on this, it analyzed the model and verified it by numerical cases. Furthermore, it compared its coordination results with those in circumstances of no emergencies and conventional emergencies respectively. It shows that the benchmark buy-back contract can coordinate the two-stage supply chain when there is no emergency, but doesn't function well when conventional and unconventional emergencies occur unless appropriate adjustments to the wholesale price of the two circumstances are made respectively. Besides, we find that, without intervening in the market, the buy-back contract can coordinate to respond to unconventional emergencies, but will add the burden to people in disaster areas, in which case proper government intervention to the market is also an option.