A Review of Profit Allocation Models for the Participants in a Supply Chain
Keywords:
Models, Profit allocation, Reviews, Supply chainAbstract
The stability and sustainability of a supply chain system can be affected by the allocation or distribution of profits to its members. Several studies have investigated this issue and proposed various quantitative models. However, no study has summarized the progress and findings of these studies. This study presents a review of the profit allocation models in supply chains. Specifically, this study aimed to identify the factors considered, the most widely used approaches or methods in model development, and research gaps for future research directions. This study applied a literature review of 53 articles were collected and reviewed. The study found that the three factors most widely considered in the studies were the level of risk faced, the resources or investments owned, and the bargaining power of supply chain participants. Cooperative games, together with the Shapley value, are the most widely used approaches or methods for model development. Several research gaps were identified, namely model development based on case studies in real supply chains involving more actors, the use of simulation approaches, and supply chain systems that consider sustainability.
References
Alahmari, S., Kamel, M., & Dahab, M. (2017). An agent-based profit allocation in supply chain management using Shapley value. Journal of Advanced Research in Electronics and Communication Engineering (IJARECE), 6.
Anna, T. (2018). Profit allocation problems for fourth party logistics supply chain coalition based on game theory approach. Journal of Economics and Management, 33, 120–135.
Anwar, S. (2023). Ketimpangan posisi daya tawar di dalam rantai pasok industri agro. In Rencana, Implementasi, dan Evaluasi Menuju Hilirisasi Industri di Indonesia (pp. 511–515). PT Lontar Digital Asia.
Anwar, S., Ekawati, I., & Ramadian, D. (2024). Optimizing negotiation process of buyer-supplier collaboration in the gambier supply chain. IOP Conference Series: Earth and Environmental Science, 1358(1), 012046. https://doi.org/10.1088/1755-1315/1358/1/012046
Asrol, M., Marimin, M., Machfud, M., Yani, Moh., & Taira, E. (2020). Supply chain fair profit allocation based on risk and value added for sugarcane agro-industry. Operations and Supply Chain Management: An International Journal, 150–165. https://doi.org/10.31387/oscm0410259
Chen, H. Z., Hu, H. D., & Yang, Z. (2013). Profits distribution within main manufacturer and suppliers in supply chain based on synergetic theory. Advanced Materials Research, 647, 944–949. https://doi.org/10.4028/www.scientific.net/AMR.647.944
Chen, L., Shen, M., & Chen, C. (2010). A research in supply chain profit allocation based on cooperation game theory. 2010 International Conference on System Science, Engineering Design and Manufacturing Informatization, 209–212. https://doi.org/10.1109/ICSEM.2010.144
Dai, B., Li, F., & Liu, Y. (2022). A profit allocation mechanism for customer-to-manufacturer platform in e-commercial business. Sage Open, 12(2), 21582440221094590. https://doi.org/10.1177/21582440221094590
Deng, A., & Li, Y. (2017). A review of research on interest distribution of supply chain based on game theory. World Journal of Research and Review, 4(6), 52–57.
Du, Y. (2015). Optimized profit allocation in an agricultural supply chain of Sichuan: International Conference on Logistics Engineering, Management and Computer Science (LEMCS 2015), Shenyang, China. https://doi.org/10.2991/lemcs-15.2015.350
Fei, T., & Li, C. (2021). Research on profit distribution between dairy farmers and manufacturing enterprises in dairy supply chain based on qualified rate. CONVERTER, 607–625. https://doi.org/10.17762/converter.90
Fiala, P. (2016). Profit allocation games in supply chains. Central European Journal of Operations Research, 24(2), 267–281. https://doi.org/10.1007/s10100-015-0423-6
Gao, E., Sowlati, T., & Akhtari, S. (2019). Profit allocation in collaborative bioenergy and biofuel supply chains. Energy, 188, 116013. https://doi.org/10.1016/j.energy.2019.116013
Gao, J., & Shi, Y. (2010). Research on the profits distribution of the supply chain using shapely value method. 2010 IEEE 17Th International Conference on Industrial Engineering and Engineering Management, 1400–1403. https://doi.org/10.1109/ICIEEM.2010.5646031
Gu, F., & Yu, X. (2022). Profit distribution mechanism of agricultural supply chain based on fair entropy. PLOS ONE, 17(7), e0271693. https://doi.org/10.1371/journal.pone.0271693
Gu, S., Guo, H., & Su, Y. (2018). Research on Supply Chain Coordination and Profit Allocation Based on Altruistic Principal under Bilateral Asymmetric Information. Discrete Dynamics in Nature and Society, 2018, 1–15. https://doi.org/10.1155/2018/2302434
Guangxia, L., Feng, L., & Weiwei, S. (2013). Profit allocation of multi-suppliers supply chain based on Shapley value. 2013 6th International Conference on Information Management, Innovation Management and Industrial Engineering, 165–170. https://doi.org/10.1109/ICIII.2013.6703540
Guardiola, L. A., Meca, A., & Timmer, J. (2007). Cooperation and profit allocation in distribution chains. Decision Support Systems, 44(1), 17–27. https://doi.org/10.1016/j.dss.2006.12.015
Hong, H., & Yanhong, W. (2008). The optimization study on profit allocation among partners in supply chain alliance based on the Shapley Value. 2008 Chinese Control and Decision Conference, 3120–3122. https://doi.org/10.1109/CCDC.2008.4597900
Hu, W., Hou, Y., Tian, L., & Li, Y. (2015). A novel profit-allocation strategy for SDN enterprises. Enterprise Information Systems, 11(1), 4–16. https://doi.org/10.1080/17517575.2015.1053417
Huo, H., & Liu, Y. (2009). Research on profit allocation of supply chain based on grey relational analysis. 2009 International Conference on Management and Service Science, 1–4. https://doi.org/10.1109/ICMSS.2009.5301346
Jiang, N. (2011). A method for the coordination supply chain surplus profits allocation problem based the collaborative risk. 2011 International Conference on Business Management and Electronic Information, 313–316. https://doi.org/10.1109/ICBMEI.2011.5920975
Karmperis, A. C., Sotirchos, A., Aravossis, K., & Tatsiopoulos, I. P. (2011). A cooperative game theory approach for the equal profit and risk allocation. Proceedings of the 2nd International Conference on Circuits, Systems, Communications & Computers, 155–160.
Kumoi, Y., & Matsubayashi, N. (2014). Vertical integration with endogenous contract leadership: Stability and fair profit allocation. European Journal of Operational Research, 238(1), 221–232. https://doi.org/10.1016/j.ejor.2014.03.022
Li, X., & Wang, Q. (2007). Coordination mechanisms of supply chain systems. European Journal of Operational Research, 179(1), 1–16. https://doi.org/10.1016/j.ejor.2006.06.023
Lv, B., & Qi, X. (2016). Profit allocation in collaborative product minor updates supply chain enterprises based on improved shapely value. Journal of Advanced Mechanical Design, Systems, and Manufacturing, 10(6), JAMDSM0088–JAMDSM0088. https://doi.org/10.1299/jamdsm.2016jamdsm0088
Lyu, F., Zhang, Y., Feng, Z., & Su, J. (2021). Profit allocation of agricultural machinery service-oriented manufacturing alliance based on modified shapley value method. Mathematical Problems in Engineering, 2021, 1–9. https://doi.org/10.1155/2021/7632642
Maflahah, I., Wirjodirdjo, B. S., & Karningsih, P. D. (2021). Demand allocation and profit sharing to improve salt farmer’s revenue: A cooperative game approach. https://doi.org/10.21203/rs.3.rs-1188072/v1
Omri, A. E. (2009). Cooperation in supply chains: Alliance formation and profit allocation among independent firms [Ecole Centrale Paris]. https://theses.hal.science/tel-00453322v1
Ponte, B., Fernández, I., Rosillo, R., Parreño, J., & García, N. (2016). Supply chain collaboration: A Game-theoretic approach to profit allocation. Journal of Industrial Engineering and Management, 9(5), 1020. https://doi.org/10.3926/jiem.2084
Prasad, S., Shankar, R., & Roy, S. (2019). Impact of bargaining power on supply chain profit allocation: A game-theoretic study. Journal of Advances in Management Research, 16(3), 398–416. https://doi.org/10.1108/JAMR-10-2018-0096
Ren, X.-Y., Feng, Q.-Q., Wang, S., & Wen, X. (2015). Profit distribution of agricultural supply chain based on Shapley value. Advance Journal of Food Science And Technology, 7. https://www.maxwellsci.com/msproof.php?doi=ajfst.7.1344
Sha, J., & Zheng, S. (2021). Revenue distribution of hybrid channel supply chain based on modified shapley value with cost. Discrete Dynamics in Nature and Society, 2021, 1–8. https://doi.org/10.1155/2021/4405185
Shi, J., & Wu, G. (2009). Study on the supply chain alliance profit allocation based on improved Shapely Value. 2009 International Conference on Management Science and Engineering, 507–512. https://doi.org/10.1109/ICMSE.2009.5317395
Song, J., Ma, X., & Chen, R. (2021). A profit distribution model of reverse logistics based on fuzzy DEA efficiency—Modified Shapley value. Sustainability, 13(13), 7354. https://doi.org/10.3390/su13137354
Song, Q. N. (2013). Study on the mechanism for profit distribution in energy supply chain. Advanced Materials Research, 734–737, 1772–1780. https://doi.org/10.4028/www.scientific.net/AMR.734-737.1772
Sun, Y., Chen, X., & Luo, Y. (2019). Profit allocation method in influenza vaccine supply chain by risk compensation. 2019 IEEE 6th International Conference on Industrial Engineering and Applications (ICIEA), 511–515. https://doi.org/10.1109/IEA.2019.8714854
Wang, F., & Dong, Y. (2019). A power-balanced pareto-equilibrium profit allocation in supply chain. IEEE Access, 7, 24889–24897. https://doi.org/10.1109/ACCESS.2019.2899952
Wang, L., & Zhou, Y. (2008). Research on cooperation profit allocation in three-stage supply chain based on distribution channel. 2008 4th International Conference on Wireless Communications, Networking and Mobile Computing, 1–6. https://doi.org/10.1109/WiCom.2008.1487
Wang, X., Jiang, L., & Shu, L. (2014). Profit allocation in fuzzy cooperative games in manufacturing and logistics industry. Journal of Industrial Engineering and Management, 7, 448–460.
Wei, L. (2021). A novel algorithm for profit distribution of sustainable development using e-commerce supply chain. Mobile Information Systems, 2021, 1–9. https://doi.org/10.1155/2021/1166788
Wei-qiong, F. (2014). Profit distribution strategy model in the three-level supply chain based on the cooperative game theory. Information Technology Journal, 13(6), 1070–1077. https://doi.org/10.3923/itj.2014.1070.1077
Wenwei, G., & Jianguo, P. (2009). Cooperation and profits distribution of reverse supply chain based on the different outsourcing degrees. 2009 16th International Conference on Industrial Engineering and Engineering Management, 1469–1473. https://doi.org/10.1109/ICIEEM.2009.5344388
Xu, Z., Peng, Z., Yang, L., & Chen, X. (2018). An Improved Shapley value method for a green supply chain income distribution mechanism. International Journal of Environmental Research and Public Health, 15(9), 1976. https://doi.org/10.3390/ijerph15091976
Yi, C. (2009). Using modified Shapley value to determine revenue allocation within supply chain. 2009 International Conference on Information Management, Innovation Management and Industrial Engineering, 78–80. https://doi.org/10.1109/ICIII.2009.26
Yu, F., Kaihara, T., & Fujii, N. (2012). A Multi-agent based negotiation for supply chain network using game theory. In J. Frick & B. T. Laugen (Eds.), Advances in Production Management Systems. Value Networks: Innovation, Technologies, and Management (Vol. 384, pp. 299–308). Springer Berlin Heidelberg. https://doi.org/10.1007/978-3-642-33980-6_34
Zeng, T., & Yang, T. (2022). Unfair and risky? Profit allocation in closed-loop supply chains by cooperative game approaches. Applied Sciences, 12(12), 6245. https://doi.org/10.3390/app12126245
Zhang, L., & Guo, H. (2021). Financial coordination and income distribution of agricultural supply chain. Proceedings of Business and Economic Studies, 4(3), 6–13. https://doi.org/10.26689/pbes.v4i3.2180
Zhang, Y., & Geng, H. (2012). An analysis on distribution of cooperative profit in supply chain based on multi-agent. Physics Procedia, 33, 698–704. https://doi.org/10.1016/j.phpro.2012.05.123
Zheng, J., & Wang, Z. (2011). The strategy of profit allocation of information sharing in the three-level supply chain. 2011 3rd International Workshop on Intelligent Systems and Applications, 1–4. https://doi.org/10.1109/ISA.2011.5873427
Zheng, X.-X., Liu, Z., Li, K. W., Huang, J., & Chen, J. (2019). Cooperative game approaches to coordinating a three-echelon closed-loop supply chain with fairness concerns. International Journal of Production Economics, 212, 92–110. https://doi.org/10.1016/j.ijpe.2019.01.011
Zhou, F., & Zhu, C. (2021). Distribution of the benefits of agricultural supply chain cooperation based on interval-valued least-squares pre-nucleolus solutions. Journal of Physics: Conference Series, 1800(1), 012005. https://doi.org/10.1088/1742-6596/1800/1/012005
Zúñiga-Arias, G., Meijer, S., Ruben, R., & Jan Hofstede, G. (2007). Bargaining power and revenue distribution in the Costa Rican mango supply chain: A gaming simulation approach with local producers. Journal on Chain and Network Science, 7(2), 143–160. https://doi.org/10.3920/JCNS2007.x084
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2024 Syamsul Anwar, Irna Ekawati, Demi Ramadian
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
