Deciding Between Independence and Coalition, in an Three Echelon Supply Chain

Document Type : Original Article


1 Assistant Professor, University of Tehran.

2 Professor, University of Tehran

3 Professor, University of Tehran.

4 Professor, Sharif University of Technology.


By considering the role and importance of supply chain management, this concept faced with many challenges and problems. Although there is no explanation of a comprehensive model for supply chain issues, a review of theoretical issues in this field, indicates that information systems, marketing, financial management, logistical and organizational relations, matters of interest to researchers in this field. The objective of supply chain management is improvement of various activities and components of a supply chain to increase overall supply chain system. Many contradictions between the components and different levels in order to achieve the overall objectives of the supply chain have been observed, and these disorders may result by decreased strength and competitiveness of supply chain. The main contradictions that are considered in this paper are related to inventory, pricing and also marketing costs in an unlimited three echelon supply chain. The basics of game theory make it a suitable and reliable tool for solving contradiction situations by considering all levels and players goal. In this paper, finding equilibrium of inventory, pricing and marketing cost of an unlimited three echelon supply chain(SC), consisting of supplier, manufacturer and retailer is considered. K retailer, M manufacturer and S supplier are acting, and different leadership of each level are examined to find the highest payoff for the supply chain.