Abstract

In the paper, an uncooperative replenishment schedule with variable trade credit is considered under a supplier-Stackelberg game, which considers time-varying demand with time-varying price and learning curve production cost for the finite planning horizon in a two-echelon supply chain. We focus on discussing which condition induces the retailer and supplier both to accept the trade credit mechanism to increase own total profits. The main insights obtained are the following: 1) trade credit period coefficient only take two values 1 or 0; 2) the smaller the supplier's additional capital opportunity cost, the supplier is more willing to offer trade credit; 3) the greater the difference of the retailer's cost parameters and the supplier's cost parameters, the supplier is more likely to participate in the proposed strategy. The proposed model may be applied in some tech-products in the introduction and the growth phase or short-life-cycle and time-sensitive products, and so on.