A new Bi-level programming model for uncertain supply chain problems

Abstract

This paper focuses on a two-level supply chain coordination problem consisting of a single supplier and multiple manufacturers under an uncertain environment. Firstly, a new bi-level programming model is proposed. Secondly, an innovative two-stage stochastic planning is combined into the lower-level manufacturer model, and a Progressive Hedging Algorithm (PHA) is designed to solve it. Then, the solved solution is substituted into the upper-level model to find the optimal solution of the bi-level programming. Finally, numerical experiments are used to verify the feasibility of the model and the algorithm.