Abstract: Based on games model,this paper studies Nash equilibrium problem of supplier and buyer’s stock-out times and reorder frequency under time-varying demand and no alternative source.Relation between supplier and buyer is analyzed based on numerical examples.Main conclusions are:the larger distributor’s reorder frequency is,the smaller retailer’s inventory cost is;retailer and distributor’s inventory cost distinctly decreases by reorder frequency optimization.

Key words: time-varying demand, no alternative source, inventory decision-making, stock-out times, reorder frequency