An application of fuzzy set theory for supply chain coordination ∗

One of the important issues in supply chain management is the coordination among different members of the supply chain. In this paper, we have studied a two-stage supply chain coordination problem under uncertain cost and demand information. The aim of the paper is to design a coordination mechanism through quantity discount policy under asymmetric information environment that allows the system to perform as closely as that of under complete information. Fuzzy set theory is applied to estimate the uncertainty associated with the input parameters and triangular membership function has been used to analyze the model. Finally, the model is illustrated with a suitable numerical example.