Abstract:For a two-echelon supply chain system formed by one manufacturer and two competing retailers, and the demand
for the product at each retailer during a single selling season is regarded as price-dependent and stochastic, the problems about
the optimal pricing and ordering decisions and the coordination of supply chain are researched. If the demand distribution
satisfies the increasing failure rate(IFR) property, the existence and uniqueness of the retailer’s optimal pricing and ordering
decisions are proved. It is also proved that supply chain can be coordinated by revenue sharing contract. Finally, the influence
of price elasticity of demand to the optimal decisions and coordination is investigated by the theoretical and numerical
analysis.