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Pricing and Coordination of Remanufacturing ClosedLoop Supply Chain Based on Product Differentiation |
SUN Hao, DA Qing-Li |
Southeast University, Nanjing, China |
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Abstract This paper establishes decision-making models in two-period remanufacturing closedloop supply chain in two cases: decentralized decision and centralized decision. Manufacturer's optimal wholesale price and buyback price, retailer's price differentiation between new and remanufactured products and their profits in two cases are derived. Changes of different parameters' impacts on pricing, collection rate and profits are analyzed. Then optimal decision-making results of decentralized decision and centralized decision are compared. The results show that 'double marginalization effect' exists in decentralized decision and its system profit is not optimal. Revenue sharing contract is utilized to coordinate the closed-loop supply chain. Finally the conclusions are verified by examples.
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Received: 02 February 2009
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