Decentralized Supply Chain Network for Emerging Issues Using Mechanism Design and Agent-Based Modeling
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Research
Supply Chain Design, Mechanism Design, Agent-based Modeling, Negotiations, Pricing
Abstract
Supply chain network is one of the problems businesses come across when they are dealing with finished goods. From making the goods to providing them to the consumer is part of the supply chain. Considering the market size and 21st-century population demands, it is crucial to have the optimal design of the supply chain network. This research aims to optimize the supply chain network design in external dealings and provides insight into the decision-making framework. The experiments are performed in NetLogo for agent-based modeling and mechanism design to portray how the supplier and customer relationship behaves in relation to price and negotiations. The study provides promising insight into more negotiations that will reduce the prices for customers and that customers at least should wait out in the first negotiation round. Lower the auction, supplier benefits. With a lower number of auctions, suppliers can manage to sell more frequently as well. This study provides empirical evidence for decisions that can benefit various parties depending on their expectations and reduce certain roadblocks. The importance of reducing such roadblocks is even greater in the times of COVID-19 affected supply chains which are having continual effects.
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