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Profit-Sharing Contracts for Fresh Agricultural Products Supply Chain Considering Spatio-Temporal Costs

Sustainability 2022, 14(4), 2315; https://doi.org/10.3390/su14042315

by Min Li^1,2,*, Lina He¹, Guangchuan Yang³

and Zhen Lian¹

Reviewer 1: Anonymous

Reviewer 2:

Prasun Kumar Nayak

Reviewer 3: Anonymous

Sustainability 2022, 14(4), 2315; https://doi.org/10.3390/su14042315

Submission received: 21 January 2022 / Revised: 8 February 2022 / Accepted: 16 February 2022 / Published: 17 February 2022

(This article belongs to the Special Issue Agrifood Production and Conservation Agriculture)

Round 1

Reviewer 1 Report

Comments to Author:

This paper was written very well and has a good opportunity to be published in this great journal, after addressing the following concerns in the first round:

- I encourage you to add more detail about your core contributions in the abstract. Abstract has five-section and you should follow the best practices in your area! Please also mention the novelties in the abstract.

- The keywords are not standard. Supply chain Network!!!! not a system..

- Long paragraphs.

- Please bring some facts and figures in the introduction to support the ideas. Especially from www.statista.com

- Literature review is very short and old! Now we are at the beginning of 2022! You have not covered the knowledge edge! Please clarify the contribution of the paper according to the research gap. Many recent papers in the area can be added to the literature review. You have not referred to the main works in this area. I do not propose you any special reference due to ethical issues. Just as the sample I suggest some works that I saw in this area in 2021 and 2022 as examples and show that you can review and cite more works in this area. The authors should review the recent works in SC areas. I simply search and find the following works:

2021:

- Developing a Bi-objective Mathematical Model to Design the Fish Closed-loop Supply Chain. International Journal of Engineering, 34(5), 1257-1268.

- Toward sustainability in designing agricultural supply chain network: A case study on palm date. Scientia Iranica, 10.24200/SCI.2021.58302.5659

- Optimizing a bi-objective multi-period fish closed-loop supply chain network design by three multi-objective meta-heuristic algorithms. Scientia Iranica, 10.24200/SCI.2021.57930.5477

- Designing a closed-loop supply chain network considering multi-task sales agencies and multi-mode transportation. Soft Computing, 25(8), 6203-6235.

2022:

- Tabu Search Based Hybrid Meta-Heuristic Approaches for Schedule-Based Production Cost Minimization Problem for the Case of Cable Manufacturing Systems. Informatica, 1-24.

- Please add more references from the target journal. The number of references is very short for such a paper. Please be at the knowledge edge.

- Please add a research gap section. The literature review is very weak and without any plan.

- In section 3, please add more references for the sentences and equations you hired. I do not suggest any special reference due to ethical issues. Please search and find.

- Please, clarify which one of the assumptions is new in this area in the problem definition.

- Check the English presentation of this paper to remove the typos mistakes.

- Findings, limitations, and recommendations of this paper can be discussed more in the conclusion section.

- Please bring and focus on future research directions.

- Why did you mention COVID in the introduction?

- There is no problem statement in the introduction.

I go with a major revision in this step and waiting for your corrections. Then, I give you my technical comments.

Author Response

Journal of Sustainability

Manuscript #: sustainability-1586613

Profit-Sharing Contracts for Fresh Agricultural Products Supply Chain Considering Spatio-Temporal Costs

Min Li*, Lina He, Guangchuan Yang, Zhen Lian

School of Economics and Management, Chang'an University, Xi’an 710064, China, limin520@chd.edu.cn, Corresponding Author

Modifications and responses to the Reviews’ Comments and Suggestions

The authors are thankful to the reviewers for their support of this paper and for the valuable comments they provided, which further improved its quality. Each comment/suggestion from the reviewers has been put in Italics and is followed by our response and action(s) to revise the paper accordingly. We hope the changes listed provided have made the manuscript suitable for publication and we look forward to your response.

REVIEWER 1:

General Comments to the Author

This paper was written very well and has a good opportunity to be published in this great journal, after addressing the following concerns in the first round:

Response:

The authors are grateful to the reviewer for the constructive comments. We have carefully addressed the comments to improve its overall quality.

Comment 1

I encourage you to add more detail about your core contributions in the abstract. Abstract has five-section and you should follow the best practices in your area! Please also mention the novelties in the abstract.

Response:

We have rewritten the abstract by adding the details of the novelties in methodology design and core contributions.

Lines 12-32:

“This paper investigated the effects of the informational asymmetry phenomenon that occurs in the direct sales of fresh agricultural products (FAP) in an e-commerce environment. A three-level FAP supply chain was proposed, which composed of a FAP supplier, a logistics service provider, and a large e-commerce platform. Considering the perishable nature of FAP, this paper analyzed the effects of logistics spatio-temporal costs and the freshness of FAP on the profit of each stakeholder in the supply chain. Three scenarios were considered: (1) complete information, (2) partial information, and (3) considering logistics spatio-temporal cost. Analytical models were developed based on the principal-agent theory and the supply chain coordination contract theory to depict the effects of the profit-sharing contract on the operations of the FAP supply chain. Modeling results indicated that under a complete information condition, an increase in the loss rate of FAP correlated to a decrease in the profit of the FAP supply chain. Under a partial information condition, considering the loss rate of FAP and the potential compensation costs to sup-pliers, when the loss rate of FAP was fixed, the profit of each stakeholder in the FAP supply chain displayed a decreasing trend with compensation ratio. In comparison, when the compensation ratio was fixed, the total profit decreased as the freshness of FAP degrades. To improve customer satisfaction, this paper recommends adding a front warehouse to improve the freshness of FAP. Although this option increases the logistics costs, it has the potential of increasing the overall profit of the FAP supply chain. Findings from this research have the potential of helping the e-commerce platform with coordinating the various stakeholders on the supply chain to deter-mine the optimal quality and quantity of FAPs, eventually, improve the operational efficiency of the FAP direct sales supply chain by reducing the logistics costs of FAP.”

Comment 2

The keywords are not standard. Supply chain Network!!!! not a system

Response:

We have revised it to Supply Chain in the text.

Comment 3

Long paragraphs.

Response:

We have carefully proofread the manuscript to split the long paragraphs into short paragraphs.

Comment 4

Please bring some facts and figures in the introduction to support the ideas. Especially from www.statista.com.

Response:

The authors are grateful to the reviewer for the constructive comment. We have added graphical illustrations of the FAP supply chain for the traditional retail mode and the proposed three-level direct sales mode.

See Figure 1. FAP supply chain: (a) Retail mode, (b) Direct sales mode

Comment 5

Literature review is very short and old! Now we are at the beginning of 2022! You have not covered the knowledge edge! Please clarify the contribution of the paper according to the research gap. Many recent papers in the area can be added to the literature review. You have not referred to the main works in this area. I do not propose you any special reference due to ethical issues. Just as the sample I suggest some works that I saw in this area in 2021 and 2022 as examples and show that you can review and cite more works in this area. The authors should review the recent works in SC areas.

Response:

We have added more references that published in 2021 and 2022.

Reference:

Narwane, V.S., Gunasekaran, A., Gardas, B. Unlocking adoption challenges of IoT in Indian Agricultural and Food Supply Chain. Smart Agricultural Technology, Vol.2, 2022, https://doi.org/10.1016/j.atech.2022.100035
Zennaro, I., Finco, S., Calzavara, M., Persona, A. Implementing E-Commerce from Logistic Perspective: Literature Review and Methodological Framework. Sustainability, 2022, Vol.14(2), 911; https://doi.org/10.3390/su14020911
Tort, O.O., Vayvay, O., Cobanoglu, E. A Systematic Review of Sustainable Fresh Fruit and Vegetable Supply Chains. Sustainability, Vol.2022, 14(3), 1573; https://doi.org/10.3390/su14031573
Chen, X., Wang, C., Li, S. The impact of supply chain finance on corporate social responsibility and creating shared value: a case from the emerging economy. Supply Chain Management, 2022, https://doi.org/10.1108/SCM-10-2021-0478
Fasihi, M., Tavakkoli-Moghaddam, R., Najafi, S.E., Hajiaghaei-Keshteli, M. Developing a Bi-objective Mathematical Model to Design the Fish Closed-loop Supply Chain. International Journal of Engineering, 2021, Vol.34(5), pp.1257-1268.
Hamdi-Asi, A., Amoozad-Khalili, H., Tavakkoli-Moghaddam, R., Hajiaghaei-Keshteli, M. Toward sustainability in designing agricultural supply chain network: A case study on palm date. Scientia Iranica, 2021, 10.24200/SCI.2021.58302.5659
Hamdi-Asi, A., Amoozad-Khalili, H., Tavakkoli-Moghaddam, R., Hajiaghaei-Keshteli, M. Toward sustainability in designing agricultural supply chain network: A case study on palm date. Scientia Iranica, 2021, 10.24200/SCI.2021.58302.5659
Batzios, A., Kontogorgos, A., Chatzitheodoridis, F., Sergaki, P. What Makes Producers Participate in Marketing Cooperatives? The Northern Greece Case. Sustainability, 2021, Vol.13(4), 1676; https://doi.org/10.3390/su13041676
Chanda, S., Bhat, M., Shetty, K.G., Jayachandran, K. Technology, Policy, and Market Adaptation Mechanisms for Sustainable Fresh Produce Industry: The Case of Tomato Production in Florida, USA. Sustainability, 2021, Vol.13(11), 5933; https://doi.org/10.3390/su13115933

Comment 6

Please add more references from the target journal. The number of references is very short for such a paper. Please be at the knowledge edge

Response:

We have added several references from the target journal.

Reference:

Zennaro, I., Finco, S., Calzavara, M., Persona, A. Implementing E-Commerce from Logistic Perspective: Literature Review and Methodological Framework. Sustainability, 2022, Vol.14(2), 911; https://doi.org/10.3390/su14020911
Tort, O.O., Vayvay, O., Cobanoglu, E. A Systematic Review of Sustainable Fresh Fruit and Vegetable Supply Chains. Sustainability, Vol.2022, 14(3), 1573; https://doi.org/10.3390/su14031573
Batzios, A., Kontogorgos, A., Chatzitheodoridis, F., Sergaki, P. What Makes Producers Participate in Marketing Cooperatives? The Northern Greece Case. Sustainability, 2021, Vol.13(4), 1676; https://doi.org/10.3390/su13041676
Chanda, S., Bhat, M., Shetty, K.G., Jayachandran, K. Technology, Policy, and Market Adaptation Mechanisms for Sustainable Fresh Produce Industry: The Case of Tomato Production in Florida, USA. Sustainability, 2021, Vol.13(11), 5933; https://doi.org/10.3390/su13115933
Zheng, Q., Wang, M., Yang, F. Optimal Channel Strategy for a Fresh Produce E-Commerce Supply Chain. Sustainability, 2021, 13, 6057. https://doi.org/10.3390/su13116057
Xu, J., Yao, G., Dai, P. Quality Decision-Making Behavior of Bodies Participating in the Agri-Foods E-Supply Chain. Sustainability, 2020, Vol.12(5), 1874; https://doi.org/10.3390/su12051874
Pietrzak, M., Chlebicka, A., Kracinski, P., Malak-Rawlikowska, A. Information Asymmetry as a Barrier in Upgrading the Position of Local Producers in the Global Value Chain - Evidence from the Apple Sector in Poland. Sustainability, 2020, Vol.12(19), 7857; https://doi.org/10.3390/su12197857
Secondi, L., Principato, L., Ruini, L., Guidi, M. Reusing Food Waste in Food Manufacturing Companies: The Case of the Tomato-Sauce Supply Chain. Sustainability, 2019, Vol.11(7), 2154; https://doi.org/10.3390/su11072154

Comment 7

Please add a research gap section. The literature review is very weak and without any plan.

Response:

We have revised the literature review and added a research gap section.

Line 180-191:

“Through the review of the state-of-the-practice in FAP supply chain management, it was found that although sufficient literature exists on supply chain management practices of various agricultural products, the majority of these studies focused on the traditional two-level supply chain that contains a supplier and a retailer. Not much work has been made on investigating FAP supply chain operations under the emerging direct sales mode. Besides, most of the works attempted to solve problems encountered by individual stakeholders of the supply chain. Despite a few studies have been conducted on the coordination of the various stakeholders, there lacks systemic comparisons of supply chain management under various information asymmetry scenarios. Thus, this study contributes towards a better understanding of the effects of information asymmetry on FAP supply chain operations under a direct sales mode, and how profit-sharing contracts between the various stakeholders will benefit the FAP supply chain management.”

Comment 8

In section 3, please add more references for the sentences and equations you hired. I do not suggest any special reference due to ethical issues. Please search and find.

Response:

We would like to clarify that the equations in Sections 3 were originally developed by the authors to depict the three-level FAP supply chain operations under various information scenarios. We acknowledge that our overall model development referenced research made by Zheng and Fan, 2018, and we have cited this work in our paper. While there are significant differences between our supply chain structure and key assumptions and the referenced work, such as we developed a three-level supply chain while the referenced work had a two-level supply chain. We also cited the references for the statements we hired in support of our model.

References:

Zheng, Q., Fan, T. Design of incentive contract for fresh agricultural products supply chain considering risk preference. Journal of Industrial Engineering/Engineering Management, 2018, Vol.32(2), pp,171-178.
Dan, B., Chen, J. Coordinating Fresh Agricultural Supply Chain under the Valuable Loss. Chinese Journal of Management Science, 2008, Vol.16(5), pp.42-49.
Gan, X., Sethi, S.P., Yan, H. Coordination of Supply Chains with Risk-Averse Agents. Production and Operations Management, 2004, Vol.13(2), pp.135-149.

Comment 9

Please, clarify which one of the assumptions is new in this area in the problem definition.

Response:

We would like to clarify that all the five assumptions were proposed based on the actual FAP supply chain operational conditions in China. Among the proposed five assumptions, assumptions 1 and 2 could be considered as common senses; assumptions 3, 4 and 5 are originally proposed by this research.

Comment 10

Check the English presentation of this paper to remove the typos mistakes.

Response:

We have carefully addressed the comments and proofread the manuscript to improve its writing quality.

Comment 11

Findings, limitations, and recommendations of this paper can be discussed more in the conclusion section.

Response:

We have revised the Concluding Remarks section, added more discussions on research findings, limitations, and future research directions.

Line 625-631:

“This paper reveals that in comparison with the two-level FAP supply chain that contains a supplier and a retailer, the three-level FAP supply chain under a direct sale mode has the potential of reducing the cost of logistics services and the loss of FAP, which eventually increases customer satisfaction. In general, it was found that the co-ordination between the various stakeholders in the FAP supply chain reduces the loss of FAP, improves the logistics services of FAP, and increases the profits of all stakeholders in the FAP supply chain. Details of the major findings from this research are presented as follows:”

Line 675-685:

“It is worth pointing out that this research was based on a three-level FAP supply chain composes of a FAP supplier, a fixed logistics service provider, and an e-commerce platform. Future works may investigate more complex supply chains with multiple FAP suppliers, multi-level logistics service providers, and multiple e-commerce platforms. Besides, this research assumes that exogenous factors, such as government policies, weather conditions, unforeseen events, etc. that may affect FAP suppliers and market demands follow a normal distribution, while in reality, these factors are more complicated. Moreover, this paper assumes that the profit share of logistics service providers is not less than 20%, but in practice, this profit share may be less than 20%. Future research works need to calibrate these factors based on real-world data, and conduct sensitivity analysis to quantify the effects of each factor on FAP supply chain operations.”

Comment 12

Please bring and focus on future research directions.

Response:

We have revised the statement in the text.

Line 675-685:

Comment 13

Why did you mention COVID in the introduction?

Response:

We mentioned COVID-19 pandemic in the Introduction section because the outbreak of COVID-19 pandemic has further pushed the use of online direct sales mode. Moreover, it is expected that in the foreseeable future, the direct sales mode will continue to be widely used as an alternative to the traditional in-person shopping mode. Thus there is a need for investigating the impacts of information asymmetry problems on direct sales supply chain operations.

Comment 14

There is no problem statement in the introduction.

Response:

We have revised the Introduction section, updated the overall organization of the Introduction and highlighted the statement of the problem involved in fresh agricultural product supply chain.

Lines 65-79:

“However, unlike industrial products, a FAP is usually available only during one or several designated seasons. Besides, as labor-intensive products, FAPs generally have a low gross unit profit, and their heavy shipping weights and the requirements for freshness-keeping effects call for higher logistics costs in comparison with other merchandises. Moreover, without interactive coordination between the supplier(s) and the physical seller(s), such as information related to consumer preferences and market demands of FAPs, may lead to either an insufficient or an excessive supply of a FAP. The former one may result in a higher cost to consumers, while the latter one tends to considerably lower down the sales price of the FAP [23]. In other words, the information asymmetry phenomenon that occurs in the production-marketing circulation of FAP could mislead the operations of the supply chain. This may result in unexpected logistics costs, and accordingly, profit losses to the supplier and increase the costs to consumers [24-29]. Therefore, an effective and reliable FAP supply chain, which links rural agriculture suppliers and urban or suburban consumers, is crucial to both rural eco-nomics and people’s basic living requirements in urban areas [30-32].”

Reviewer 2 Report

The idea of this paper is interesting. This paper has a certain degree of innovation. But, the paper lacks in terms of technical representation. However, the paper can be improved by considering the following issues.

The introductory section must appropriately highlight the motivations and objectives of this research.

The authors fail to properly motivate their research. The research gaps are not identified.

Novelty of this paper should be provided in an Authors' contribution table.

Graphical illustrations are insufficient, sensitivity analysis is missing.

Please add some managerial insights from the industrial viewpoints in a separate section.

Please read and cite the following articles into the text-https://doi.org/10.1016/j.cie.2020.106765; https://doi.org/10.1007/s40819-020-0772-2

Recommendation: Minor Revision

Author Response

Journal of Sustainability

Manuscript #: sustainability-1586613

Profit-Sharing Contracts for Fresh Agricultural Products Supply Chain Considering Spatio-Temporal Costs

Min Li*, Lina He, Guangchuan Yang, Zhen Lian

School of Economics and Management, Chang'an University, Xi’an 710064, China, limin520@chd.edu.cn, Corresponding Author

Modifications and responses to the Reviews’ Comments and Suggestions

REVIEWER 2:

General Comments to the Author

Response:

The authors are grateful to the reviewer for the constructive comments. We have carefully addressed the comments to improve its overall quality.

Comment 1

The introductory section must appropriately highlight the motivations and objectives of this research.

Response:

We have thoroughly rewritten the Introduction section, updated the overall organization of the Introduction and highlighted the statement of the problem involved in FAP supply chain and targets.

Specifically, the Introduction starts with the importance of fresh agricultural products (FAP) and the increasingly popular of the “direct sales” of FAP; then, we move the flow to the operational features of the direct sales of FAP. After that, we described the problems in the FAP supply chain under a direct sales mode. Finally, we emphasized the importance of this research and how the findings from this research will benefit the FAP supply chain.

Comment 2

The authors fail to properly motivate their research. The research gaps are not identified.

Response:

We have revised the Introduction section to highlight the research problem and motivations. A discussion on research gap was added after the Literature Review section.

Line 180-191:

“Through the review of the state-of-the-practice in FAP supply chain management, it was found that although sufficient literature exists on supply chain management practices of various agricultural products, the majority of these studies focused on the traditional two-level supply chain that contains a supplier and a retailer. Not much work has been made on investigating FAP supply chain operations under the emerging direct sales mode. Besides, most of the works attempted to solve problems encountered by individual stakeholders of the supply chain. Despite a few studies have been con-ducted on the coordination of the various stakeholders, there lacks systemic compari-sons of supply chain management under various information asymmetry scenarios. Thus, this study contributes towards a better understanding of the effects of information asymmetry on FAP supply chain operations under a direct sales mode, and how profit-sharing contracts between the various stakeholders will benefit the FAP supply chain management.”

Comment 3

Novelty of this paper should be provided in an Authors' contribution table.

Response:

Novelty of this research is to investigate the effects of information asymmetry on FAP supply chain operations under a direct sales mode, and for each information asymmetry scenario, this research figures out how profit-sharing contracts between the various stakeholders will benefit the FAP supply chain management. We have added the statements in the Introduction and Literature Review sections.

Line 79-82:

“In this regard, to improve the operational efficiency of the FAP direct sales supply chain, there is an urgent need to investigate the impacts of information asymmetry problems on direct sales supply chain operations and the coordination between various stakeholders of the supply chain. Eventually, reduce the logistics spatio-temporal costs of FAP.”

Line 187-190:

“Thus, this study contributes towards a better understanding of the effects of information asymmetry on FAP supply chain operations under a direct sales mode, and how profit-sharing contracts between the various stakeholders will benefit the FAP supply chain management.”

Comment 4

Graphical illustrations are insufficient, sensitivity analysis is missing.

Response:

Thanks for the reviewer’s insightful comment. We have revised the model specification in the Methodology section, added a graphical comparison of the FAP supply chain between the traditional retail mode and the proposed three-level direct sales mode (Figure 1 in the revised manuscript). In terms of sensitivity analysis, we would like to clarify that this paper, at a theoretical level, tested the effects of an individual factor (i.e., loss rate in Figure 2 and supply compensation ratio in Figure 3) and combined effect of the two factors (Figure 4) on the profit of the supply chain under a partial information condition. We would like to point out that although the parameters used in the numerical example were based on reasonable assumptions, they may not exactly represent real-world FAP supply chain operational conditions. We have acknowledged this research limitation in the Concluding Remarks section and added a statement that future research works need to calibrate these factors based on real-world data, and conduct sensitivity analysis to quantify the effects of each factor on FAP supply chain operations.

Comment 5

Please add some managerial insights from the industrial viewpoints in a separate section.

Response:

Thanks for this insightful comment! We have added managerial insights at the end of each findings in the Concluding Remarks section:

Line 652-654:

“This also shows that Internet of Things and Information Technology have been playing a significant role in promoting economic development and can make the FAP supply chain more coordinated.”

Line 663-666:

“Findings from this research have the potential of directing the capital investment to the FAP supply chain, such as having the supplier to install a front warehouse to increase the profit of the supply chain.”

Line 670-674:

“Based on the above results, e-commerce platforms can purchase products with different degrees of freshness to accommodate various consumers and choose logistics service providers and FAP suppliers that meet their expectations. FAP suppliers can also choose the most suitable e-commerce that could maximize their profit.”

Comment 6

Please read and cite the following articles into the text -https://doi.org/10.1016/j.cie.2020.106765;https://doi.org/10.1007/s40819-020-0772-2

Response:

We have cited the advised references in the text:

References:

Ghosh, S.K., Seikh, M.R., Chakrabortty, M. Analyzing a stochastic dual-channel supply chain under consumers’ low carbon preferences and cap-and-trade regulation. Computers & Industrial Engineering, Vol.149, 2020, https://doi.org/10.1016/j.cie.2020.106765
Ghosh, S.K., Seikh, M.R., Chakrabortty, M. Pricing Strategy and Channel Co-ordination in a Two-Echelon Supply Chain Under Stochastic Demand. International Journal of Applied and Computational Mathematics, Vol.6, 2020, https://doi.org/10.1007/s40819-020-0772-2

Reviewer 3 Report

The introduction is not very useful. Therefore, the introduction should be extended very carefully. The introduction section should be rewritten again. The introduction should highlight the study's novelty and motivation and put some literature without any useful explanation; in fact, the introduction should be clearly stated research questions and targets first. Then answer several questions: Why is the topic important (or why do you study on it)? What are the research questions? What has been studied? What are your contributions? Why is it to propose this particular method? This study's major defect is the debate or argument is not clearly stated in the introduction session.

I would suggest the author improve your theoretical discussion and arrives at your debate or argument. In addition, the background introduction should be condensed. The literature review is not presented in a good structure, and at the end of LR, you should come out with a paragraph to conclude your discussion, in this paragraph, you can highlight the novelty of your study also, it means what the LR has done and what you want to do. The literature review must highlight the novelty and contribution of the study, but these sections, which the authors provided only are related works and not literature review. Authors must carefully revise these sections.

There are several grammatical errors in the paper.

Author Response

Journal of Sustainability

Manuscript #: sustainability-1586613

Profit-Sharing Contracts for Fresh Agricultural Products Supply Chain Considering Spatio-Temporal Costs

Min Li*, Lina He, Guangchuan Yang, Zhen Lian

School of Economics and Management, Chang'an University, Xi’an 710064, China, limin520@chd.edu.cn, Corresponding Author

Modifications and responses to the Reviews’ Comments and Suggestions

REVIEWER 3:

Comment 1

Response:

We have thoroughly rewritten the Introduction section, updated the overall organization of the Introduction and highlighted the statement of the problem involved in FAP supply chain and targets.

Comment 2

Response:

See Figure 1. FAP supply chain: (a) Retail mode, (b) Direct sales mode.

Line 616-630:

“This paper employs the freshness of FAP and logistics spatio-temporal cost as variables to develop FAP supply chain analytical models for modeling the profit-sharing contracts between the E-commerce platform, FAP suppliers, and logistics service providers. Three scenarios were considered: 1) complete information, 2) partial information, and 3) considering logistics spatio-temporal cost (including intently increases in logistics spatio-temporal costs to accommodate customer requirements). For each scenario, sales profits assigned to each of the three stakeholders in the supply chain were calculated, and the changes in sales profits were analyzed.

This paper reveals that in comparison with the two-level FAP supply chain that contains a supplier and a retailer, the three-level FAP supply chain under a direct sale mode has the potential of reducing the cost of logistics services and the loss of FAP, which eventually increases customer satisfaction. In general, it was found that the co-ordination between the various stakeholders in the FAP supply chain reduces the loss of FAP, improves the logistics services of FAP, and increases the profits of all stakeholders in the FAP supply chain. Details of the major findings from this research are presented as follows:”

We have revised the literature review and added a discussion on research gas and novelty of this research.

Line 180-191:

“Through the review of the state-of-the-practice in FAP supply chain management, it was found that although sufficient literature exists on supply chain management practices of various agricultural products, the majority of these studies focused on the traditional two-level supply chain that contains a supplier and a retailer. Not much work has been made on investigating FAP supply chain operations under the emerging direct sales mode. Besides, most of the works attempted to solve problems encountered by individual stakeholders of the supply chain. Despite a few studies have been con-ducted on the coordination of the various stakeholders, there lacks systemic comparisons of supply chain management under various information asymmetry scenarios. Thus, this study contributes towards a better understanding of the effects of information asymmetry on FAP supply chain operations under a direct sales mode, and how profit-sharing contracts between the various stakeholders will benefit the FAP supply chain management.”

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Profit-Sharing Contracts for Fresh Agricultural Products Supply Chain Considering Spatio-Temporal Costs

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