Supply Chain Collaboration Mechanism with Option under Market Demand Indefinite

The risks created by the market demand indefinite exist in the supply chain inevitably. These risks may result in the problem of coordination in supply chain. The ordering and production plan of the enterprise was influenced by the market demand indefinite, and then the risk and the complexity of profit collocation also can be influenced. The realization of the risk and profit sharing is one of the basic purposes for supply chain management in supply chain. Introducing the option mechanism, this paper analysis the impact of derivatives on supply chain performance when market demand is uncertain, and the option mechanism for upstream downstream is proposed to evade market risk jointly, which can enhance information flows, encourage risk sharing, improve supply chain efficiently and realize the chain partner collaboration.