Abstract:Based on the situation of unequal positions between the competitive supply chains and the character of
diseconomy of scale in the production progress of manufacturers, the paper discusses whether two part tariff contract can help to achieve supply chain coordination and the Pareto improvement between the members. The results show that the ratio of diseconomy of scale doesn’t affect the equilibrium structure, and the profit of the follow chain increases with the competitive ratio increasing under the equilibrium structure. When the intensity of market competitive is weak, the reasonable two fixedprice contract can help to achieve the supply chain coordination while both the manufacturer and retailer can have Pareto improvement.