Supply chain coordination with uncertain just-in-time delivery

Coordinating producer and supplier is one of the main issues of supply chain management. The paper investigates this problem by means of a single-period order and delivery planning model within a Just-in-Time setting. The aim of the paper is to find a coordination mechanism that allows the system to perform just as well as a centralized one. Since the acceptance of a coordination mechanism depends on the associated expected costs for each party of the supply chain, the paper focuses not only on the overall performance but also on the allocation of the cost. (C) 2002 Elsevier Science B.V. All rights reserved.