Pricing and profit distribution strategy for manufacturer and retailer in a supply chain

This paper presents a model for designing the pricing and profit-allotting strategy for a manufacturer-retailer alliance of single-period commodities. Mathematical formulations are developed based on negotiation and cooperation, and optimal coordination policies that result in an increase in the total joint. profit are analyzed, both manufacturer and retailer can gain more benefit on the basis of a proper profit-allotting coefficient. Also, a numerical example is taken to support the conclusions. Then, then the results of the partners' continuous games are discussed. Therefore it is significant to consider the manufacturer-retailer strategy for a long-term cooperation.