A two-stage prefabricated construction supply chain coordination mechanism considering overtime and capacity sharing under capacity constraints

In actual production activities, the productivity of prefabricated components may be affected by some factors, some prefabricated construction manufacturers face capacity constraints. Through overtime and capacity sharing, the prefabricated construction manufacturer effectively improves his production capacity. Based on the setting, this study constructs a mathematical model for seeking the supply chain members’ optimal pricing decision-making and the optimal profit. Theoretical analysis reveals that the centralized decision results in higher profit for the entire supply chain compared to the decentralized decision. To achieve coordination within the supply chain, a linear transfer payment contract is proposed. The findings indicate that the linear transfer payment contract effectively coordinates the supply chain while improving the benefits for all parties involved.