Modelling three-echelon warm-water fish supply chain: A bi-level optimization approach under Nash-Cournot equilibrium

Abstract Nowadays, a great deal of attention is given to have sustainable supply management of food resources and to distribute high-quality food products throughout a profitable supply chain. Supply chain coordination focuses on the collaboration and synchronization among supply chain players to achieve higher performance and to create a competitive advantage. The coordination in perishable food supply chain is of great importance; however, the number of studies in the area is not considerable. This paper proposes a novel modeling and optimization approach that addresses non-cooperative farmed fish supply chain coordination as a real case of perishable food supply chain by formulating a bi-level Nash-Cournot and Nash-Stackelberg equilibrium model. The proposed model belongs to the class of NP-hard problems; thus, a new approach called PMSPSO is proposed to find equilibrium solution. Computational results are presented based on an application of the model on a warm-water farmed fish supply chain in the Northern littoral region of Iran. Obtained results indicate that the proposed coordination model for the fish supply chain leads to higher total profit for any of the supply chain members compared with the scenario where there is no coordination among them in different levels of the supply chain.