The Pricing Coordination of Manufacturers Based on Logistics Outsourcing

Abstract

The static cooperation model between two manufacturers and a Third-party Logistics (3PLs) provider is represented in this paper. Under 3PLs provider’s restriction on service prices, manufacturers decide wholesale prices and reclaiming prices in independent decisions scenario and joint decisions scenario respectively. Comparing with the profit of manufacturers and 3PLs provider, we establish a mechanisms: Coordinating with Discounts of Logistics Prices based on four assumptions and three partners’ abilities of negotiating. Finally, we illustrate our mechanism with a numerical example.