Skip to main content

Advertisement

SpringerLink
Log in

Pricing and recovery in a dual-channel closed-loop supply chain under uncertain environment

  • Soft computing in decision making and in modeling in economics
  • Published:
Soft Computing Aims and scope Submit manuscript

Abstract

This paper studies the pricing and recovery strategies in a closed-loop supply chain that is composed of a manufacturer, a retailer and a third-party recycling center. The manufacturer sells products through the online channel and the traditional retail channel. In the reverse recycling channel, the used products are collected for remanufacturing through the manufacturer channel or the third-party channel. However, the product update speed for products such as mobile phone and software industries is accelerated, and the manufacturing sales costs, retailer sales costs, collecting costs, consumer demands and the quantities of recycled products are usually uncertain due to the lack or insufficiency of historical data. Considering the effective different recycling channels, two Stackelberg game models led by the manufacturer are developed to analyze the difference between the manufacturer and the third-party recycling channel. We also discussed the optimal decision and maximum expected profit under the centralized decision model. Some corresponding analytical solutions are derived to solve the models. Finally, numerical experiments are conducted to examine the impact on customer acceptance of the online channel on pricing decisions. To examine the effects of key uncertain parameters on the optimal decisions, we perform sensitivity analysis on some important parameters.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Fig. 1

Similar content being viewed by others

References

  • Cai X, Lai M, Li X, Li Y, Slowinski R, Artalejo J, Billaut JC, Dyson R, Peccati L (2014) Optimal acquisition and production policy in a hybrid manufacturing/remanufacturing system with core acquisition at different quality levels. Eur J Oper Res 233:374–382

    MathSciNet  Google Scholar 

  • Chen JM, Chang CI (2012) The co-opetitive strategy of a closed-loop supply chain with remanufacturing. Transp Res Part E 48:387–400

    Google Scholar 

  • Chen JM, Chang CI (2013) Dynamic pricing for new and remanufactured products in a closed-loop supply chain. Int J Prod Econ 146:153–160

    Google Scholar 

  • Chen X (2010) American option pricing formula for uncertain financial market. In: International conference on uncertainty theory, pp 27–32

  • Chuang CH, Wang CX, Zhao Y (2014) Closed-loop supply chain models for a high-tech product under alternative reverse channel and collection cost structures. Int J Prod Econ 156:108–123

    Google Scholar 

  • Dan B, Xu G, Liu C (2012) Pricing policies in a dual-channel supply chain with retail services. Int J Prod Econ 139:312–320

    Google Scholar 

  • Ding Q, Dong C, Pan Z (2016) A hierarchical pricing decision process on a dual-channel problem with one manufacturer and one retailer. Int J Prod Econ 175:197–212

    Google Scholar 

  • Ding S (2013) Uncertain multi-product newsboy problem with chance constraint. Elsevier Science Inc, Amsterdam

    MATH  Google Scholar 

  • Esmaeili M, Allameh G, Tajvidi T (2016) Using game theory for analysing pricing models in closed-loop supply chain from short-and long-term perspectives. Int J Prod Res 54:1–18

    Google Scholar 

  • Ferguson ME, Toktay LB (2010) The effect of competition on recovery strategies. Prod Oper Manag 15:351–368

    Google Scholar 

  • Ferrer G, Swaminathan JM (2006) Managing new and remanufactured products. Manage Sci 52:15–26

    MATH  Google Scholar 

  • Gan SS, Pujawan IN, Suparno Widodo B (2016) Pricing decision for new and remanufactured product in a closed-loop supply chain with separate sales-channel. Int J Prod Econ 190:120–132

    Google Scholar 

  • Gao J, Liang Z, Shang J, Xu Z (2019) Remanufacturing with patented technique royalty under asymmetric information and uncertain markets. Technol Econ Dev Econ 26(3):1–22

    Google Scholar 

  • Gao Y (2012) Uncertain models for single facility location problems on networks. Appl Math Model 36:2592–2599

    MathSciNet  MATH  Google Scholar 

  • Giri BC, Chakraborty A, Maiti T (2017) Pricing and return product collection decisions in a closed-loop supply chain with dual-channel in both forward and reverse logistics. J Manuf Syst 42:104–123

    Google Scholar 

  • Govindan K, Popiuc MN, Diabat A (2013) Overview of coordination contracts within forward and reverse supply chains. J Clean Prod 47:319–334

    Google Scholar 

  • Govindan K, Soleimani H, Kannan D (2015) Reverse logistics and closed-loop supply chain: a comprehensive review to explore the future. Eur J Oper Res 240:603–626

    MathSciNet  MATH  Google Scholar 

  • Hong IH, Yeh JS (2012) Modeling closed-loop supply chains in the electronics industry: a retailer collection application. Transp Res Part E 48:817–829

    Google Scholar 

  • Hong X, Wang Z, Wang D, Zhang H (2013) Decision models of closed-loop supply chain with remanufacturing under hybrid dual-channel collection. Int J Adv Manuf Technol 68:1851–1865

    Google Scholar 

  • Hong X, Xu L, Du P, Wang W (2015) Joint advertising, pricing and collection decisions in a closed-loop supply chain. Int J Prod Econ 167:12–22

    Google Scholar 

  • Huang M, Song M, Lee LH, Ching WK (2013) Analysis for strategy of closed-loop supply chain with dual recycling channel. Int J Prod Econ 144:510–520

    Google Scholar 

  • Karakayali I, Emir-Farinas H, Akcali E (2007) An analysis of decentralized collection and processing of end-of-life products. J Oper Manag 25:1161–1183

    Google Scholar 

  • Ke H, Wu Y, Huang H, Chen Z (2017) Pricing decision in a two-echelon supply chain with competing retailers under uncertain environment. J Uncertain Anal Appl 5:5

    Google Scholar 

  • Li X, Li Y, Cai X (2015) Remanufacturing and pricing decisions with random yield and random demand. Comput Oper Res 54:195–203

    MathSciNet  MATH  Google Scholar 

  • Liu B (2007) Uncertainty theory. Springer Publishing Company, Incorporated

    MATH  Google Scholar 

  • Liu B (2009) Some research problems in uncertainty theory. J Uncertain Syst 3:3–10

    Google Scholar 

  • Liu B (2010) Uncertainty theory: a branch of mathematics for modeling human uncertainty. DBLP

  • Liu Y, Ha M (2010) Expected value of function of uncertain variables. J Uncertain Syst 4:181–186

    Google Scholar 

  • Mahadevanabc B (2003) Periodic review, push inventory policies for remanufacturing. Eur J Oper Res 151:536–551

    MathSciNet  MATH  Google Scholar 

  • Maiti T, Giri BC (2015) A closed loop supply chain under retail price and product quality dependent demand. J Manuf Syst 37:624–637

    Google Scholar 

  • Mitra S (2009) Analysis of a two-echelon inventory system with returns. Omega 37:106–115

    Google Scholar 

  • Mota B, Gomes MI, Carvalho A, Barbosa-Povoa AP (2017) Sustainable supply chains: an integrated modelling approach under uncertainty. Omega 77

  • Savaskan RC, Bhattacharya S, Wassenhove LNV (2004) Closed-loop supply chain models with product remanufacturing. Manage Sci 50:239–252

    MATH  Google Scholar 

  • Savaskan RC, Wassenhove LNV (2006) Reverse channel design: the case of competing retailers. Manage Sci 52:1–14

    MATH  Google Scholar 

  • Schenkel M, Caniels MCJ, Krikke H, Laan EVD (2015) Understanding value creation in closed loop supply chains past findings and future directions. J Manuf Syst 37:729–745

    Google Scholar 

  • Song Q, Ni Y, Ralescu DA (2020) The impact of lead-time uncertainty in product configuration. Int J Prod Res. https://doi.org/10.1080/00207543.2020.1715506

    Article  Google Scholar 

  • Tsay AA, Agrawal N (2010) Channel conflict and coordination in the e-commerce age. Prod Oper Manag 13:93–110

    Google Scholar 

  • Vorasayan J, Ryan SM (2010) Optimal price and quantity of refurbished products. Prod Oper Manag 15:369–383

    Google Scholar 

  • Wei J, Govindan K, Li Y, Zhao J (2015) Pricing and collecting decisions in a closed-loop supply chain with symmetric and asymmetric information. Comput Oper Res 54:257–265

    MathSciNet  MATH  Google Scholar 

  • Wei J, Zhao J (2016) Pricing decisions for substitutable products with horizontal and vertical competition in fuzzy environments. Ann Oper Res 242:505–528

    MathSciNet  MATH  Google Scholar 

  • Xiong Y, Zhao Q, Zhou Y (2016) Manufacturer-remanufacturing vs supplier-remanufacturing in a closed-loop supply chain. Int J Prod Econ 176:21–28

  • Xu J, Liu N (2017) Research on closed loop supply chain with reference price effect. J Intell Manuf 28:51–64

    Google Scholar 

  • Yan G, Ni Y, Yang X (2020) Optimal pricing in recycling and remanufacturing in uncertain environments. Sustainabilit 12:1–16

    Google Scholar 

  • Yao K (2015) A formula to calculate the variance of uncertain variable. Soft Comput 19:2947–2953

    MATH  Google Scholar 

  • Yi P, Huang M, Guo L, Shi T (2016) Dual recycling channel decision in retailer oriented closed-loop supply chain for construction machinery remanufacturing. J Clean Prod 137:1393–1405

    Google Scholar 

  • Zadeh LA (1965) Fuzzy sets, information and control. Inf Control 8:338–353

    MATH  Google Scholar 

  • Zhao J, Tang W, Zhao R, Wei J (2012) Pricing decisions for substitutable products with a common retailer in fuzzy environments. Eur J Oper Res 216:409–419

    MathSciNet  MATH  Google Scholar 

  • Zhou C, Zhao R, Tang W (2008) Two-echelon supply chain games in a fuzzy environment. Comput Ind Eng 55:390–405

    Google Scholar 

Download references

Funding

This work was supported by National Natural Science Foundation of China (No. 71471038) and “The Fundamental Research Funds for the Central Universities” in UIBE (No. CXTD10-05).

Author information

Authors and Affiliations

  1. College of Science, Hebei Agricultural University, Baoding, 071001, China

    Guangzhou Yan

  2. School of Information Technology and Management, University of International Business and Economics, Beijing, 100029, China

    Yaodong Ni

  3. School of Information Technology and Management, University of International Business and Economics, Beijing, 100029, China

    Xiangfeng Yang

Authors
  1. Guangzhou Yan
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Yaodong Ni
    View author publications

    You can also search for this author in PubMed Google Scholar

  3. Xiangfeng Yang
    View author publications

    You can also search for this author in PubMed Google Scholar

Contributions

GY and YN were involved in conceptualization; GY contributed to software, methodology, investigation and resources; YN and XY were involved in supervision; and YN was involved in project administration and funding acquisition. All authors have read and agreed to the published version of the manuscript.

Corresponding author

Correspondence to Yaodong Ni.

Ethics declarations

Conflict of interest

No potential conflict of interest was reported by the authors.

Ethical approval

This article does not contain any studies with human participants or animals performed by any of the authors.

Informed consent

All participants informed the consent.

Additional information

Publisher's Note

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Rights and permissions

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Yan, G., Ni, Y. & Yang, X. Pricing and recovery in a dual-channel closed-loop supply chain under uncertain environment. Soft Comput 25, 13679–13694 (2021). https://doi.org/10.1007/s00500-021-06117-1

Download citation

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s00500-021-06117-1

Keywords

Search

Navigation