Integration Dual Channel Supply Chain with Permissible Delay in Payment & Delay of Online Product Launch Considerations

Abstract

This study provides an overview of integrated supply chain contracts under the dual channel problem. Dual channel policy is aimed at achieving the new market potential that can not be reached by traditional channel (retail). Dual channel policy is not always beneficial for all channel members, the offline channel will be cannibalism by online channel. The model developed in this study is expected to accommodate the coordination between players in an integrated supply chain system, where one player uses dual channel policy. In the echelon one coordination is done with consideration of time period of delay in payment. Whereas in echelon two coordination between players is done by consideration of delay in payment and online product launch delay. Numerical calculations are solved with the Solver in Excel software. The coordination contract successfully creates an integrated supply chain. This can be proved by a more minimal total cost when compared to not using one or both of these considerations.