Dual-channel Supply Chain Network Equilibrium Model Under Retailers’ Risk Aversion

doi:10.16182/j.issn1004731x.joss.25-0690

Abstract

Abstract:

To study the network equilibrium problem of dual-channel supply chains under the background of retailers' risk aversion, a dual-channel supply chain network equilibrium model including multiple competitive suppliers, manufacturers, retailers, and demand markets was established. The Mean-CVaR method was employed to quantify retailers' risk aversion characteristics, andvariational inequalities were utilizedto characterize the equilibrium conditions of decision-makers at each tier of the supply chain. The projection contraction algorithm was applied to solve the model and conduct numerical analysis, thereby revealing the impact of retailers' risk aversion behavior on equilibrium outcomes. The simulation results indicate that a higher degree of risk aversion among retailers enhances the overall profit or utility levels of supply chain network members. While retailers tend to prioritize expected profit, other network participants prefer them to focus more on CVaR-based profit. Furthermore, retailers' risk aversion behavior significantly influences demand markets' channel selection preferences.The results provide a theoretical basis for optimizing production and pricing decisions and managing demand uncertainty risks in dual-channel supply chain networks.

Key words: dual-channel, supply chain network, risk aversion, variational inequality, mean-CVaR

CLC Number:

F274

Wang Hongchun, Lin Caifeng, He Xinyi, Yin Haiyue. Dual-channel Supply Chain Network Equilibrium Model Under Retailers’ Risk Aversion[J]. Journal of System Simulation, 2025, 37(12): 3050-3059.

Figures/Tables 2

Fig. 1

Table 1

Impact of retailers' preference weighting and risk aversion changes on dual-channel supply chain network equilibrium

变量	$λ = 0.5$			$λ = 0.6$			$λ = 0.8$
变量	$η = 0.5$	$η = 0.6$	$η = 0.8$	$η = 0.5$	$η = 0.6$	$η = 0.8$	$η = 0.5$	$η = 0.6$	$η = 0.8$
$(q n i) 2 × 2$	1.857 5	1.856 8	1.855 5	1.857 1	1.856 4	1.855 3	1.856 0	1.855 6	1.854 9
$(q i j) 2 × 2$	1.021 2	1.020 2	1.018 5	1.020 6	1.019 7	1.018 2	1.019 1	1.018 5	1.017 7
$(q i d) 2 × 2$	0.836 3	0.836 6	0.837 0	0.836 5	0.836 7	0.837 1	0.836 8	0.837 0	0.837 2
$(d j) 1 × 2$	2.042 5	2.040 5	2.037 1	2.041 3	2.039 5	2.036 6	2.038 4	2.037 2	2.035 5
$(w n i) 2 × 2$	5.829 6	5.827 6	5.824 3	5.828 5	5.826 7	5.823 8	5.825 6	5.824 5	5.822 8
$(w i j) 2 × 2$	11.288 0	11.284 0	11.278 0	11.286 0	11.282 0	11.277 0	11.280 0	11.278 0	11.275 0
$(p j) 1 × 2$	24.480 0	24.504 0	24.545 0	24.494 0	24.516 0	24.551 0	24.529 0	24.543 0	24.563 0
$(p i) 1 × 2$	11.957 0	11.953 0	11.947 0	11.955 0	11.951 0	11.946 0	11.949 0	11.947 0	11.944 0
$(π n) 1 × 2$	7.591 0	7.584 7	7.574 3	7.587 4	7.581 7	7.572 8	7.578 5	7.574 8	7.569 6
$(π i) 1 × 2$	7.250 4	7.245 5	7.237 4	7.247 6	7.243 2	7.236 2	7.240 6	7.237 8	7.233 7
$G (π j) 1 × 2$	13.345 0	10.176 0	5.974 4	14.221 0	11.706 0	8.339 6	15.982 0	14.750 0	13.059 0

Table 1

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