OPTION CONTRACT AND CAPACITY RESERVATON CONTRACT IN A SUPPLY CHAIN

摘要

This paper compares the performance in asupply chain for two type of contracts;option and capacity reservaaion.Inthis work we consider a dyadic supply chain formed by one retailer and one supplier, and we compare the performances for both companies and for the whole chain as a single unit under two gypes of contracts:option and capacity reservation.An option contract is one where the retailer orders a quantity of nuits and has a right to modify his order in any sense (it may be bigger or smaller than the initial order) without restrictions by buying the option premium in advance from the supplier.With a capacity reservation contract, the retailer reserver a number of units from the supplier and, after receiving more information about demand,he decides his final order.The main difference between both contracts is that with an option contract the retailer pays for the righut of changing his order, and with c capacity reservation contract the retailer pays in advance for the right to buy up to a fixde quantity.Fist the theoretical bases are introduced for each contract,next both conrracts are compared and finally the conclusions are presented.