Joint Procurement among Manufacturers Led by Negotiation Representatives: Incentive Strategies in a Bargaining Game

This paper investigates the internal game under the joint procurement mode in a two-echelon supply chain composed of one supplier and two downstream manufacturers with heterogeneous bargaining powers. By constructing game models for all negotiating participants, this paper analyzes the optimal decisions and profits of each supply chain member under three scenarios: separate procurement by manufacturers, joint procurement without incentives, and joint procurement with incentives.The study finds that incentive measures always help to mitigate market competition intensity. When the bargaining weight of the negotiation representative manufacturer is small, the incentive effect on the negotiation representative is more pronounced, prompting the representative to negotiate a lower wholesale price. When the bargaining weight of the negotiation representative manufacturer is large, incentive measures maintain the existing market competition equilibrium, avoiding intense sales competition. For manufacturers, joint procurement is always superior to independent procurement. Moreover, when the bargaining weight of the negotiation representative manufacturer is significantly higher or slightly lower than that of the joint member, the optimal procurement mode for both the negotiation representative and the joint member manufacturers is joint procurement with incentives. For suppliers, to maximize their own interests, they should encourage manufacturers to procure independently and offer certain procurement preferential policies to weaker manufacturers.