Green supply chain contracting for a dominant retailer under competition

We investigate a green supply chain contracting faced by a dominant retailer who purchases green products from a supplier in the presence of a weak retailer's competition and dual cost information asymmetry of the supplier and the weak retailer. Only one of the retailers has an opportunity to work with the supplier. If the dominant retailer gets the opportunity, he will become the contract's designer due to his dominant market power. While if the weak retailer gets it, the supplier will be taken as the contract's designer because the weak retailer's market power is so weak that it is eager to acquire the supplier's business. We model this problem from the perspective of the dominant retailer whose objective is to win the business with the supplier, and further evaluate how the weak retailer's competition and dual information asymmetry affect the dominant retailer's contracting, the dominant retailer's profit, the supplier's profit as well as the total supply chain profit in different scenarios (with and without the weak retailer's competition under the different information structures, respectively). An important implication from our analysis is that the weak retailer's competition sacrifices partly the dominant retailer's profit, but benefits the supplier. Simultaneously, the weak retailer's private information may lessen the dominant retailer's loss. We also conclude that the supplier's private information affects the total supply chain profit, while the weak retailer's private information only affects the allocation of the total supply chain profit.