This article considers a two-period closed-loop supply chain (CLSC) model, where a manufacturer and a retailer are trading one product. The retailer’s demand rate for each period is dependent on the selling price, product quality, and refund price. The first period’s product quality has an impact on the second period’s demand rate. In the first period, returned products are remanufactured and sold through the retailer with the new products in the second period. The manufacturer is the leader of the Stackelberg game who declares wholesale price(s) and quality of the product to the retailer who follows the manufacturer’s decision and sets his selling prices for two consecutive periods. The manufacturer implements two pricing policies: (I) sets the same wholesale price for both periods (II) sets different wholesale prices for two different periods. The present research’s main aim is to find the optimal strategies for lower pricing and high-quality products. Under these circumstances, four different decision strategies between the manufacturer and the retailer are developed and compared these strategies analytically and numerically. The effects of different decision strategies on the optimal supply chain results are developed with a numerical example. An optimal solution for all four strategies is obtained using Mathematica 9. In addition, graphical analyses are developed to determine under what circumstances a particular decision strategy is dominant over others. Numerical analysis suggests that fast-acting strategies produce dominant results, but adopting strategies with advanced notice can produce higher quality products.
Keywords: Two-echelon closed loop supply chain, two-period, decision strategy, price and quality dependent demand, dynamic pricing, return with refund price
@article{RO_2022__56_6_3817_0,
author = {Maiti, Tarun},
title = {Optimal product quality and pricing strategy for a two-period closed-loop supply chain under return policy},
journal = {RAIRO. Operations Research},
pages = {3817--3843},
year = {2022},
publisher = {EDP-Sciences},
volume = {56},
number = {6},
doi = {10.1051/ro/2022190},
mrnumber = {4507304},
zbl = {1532.90006},
language = {en},
url = {https://www.numdam.org/articles/10.1051/ro/2022190/}
}
TY - JOUR AU - Maiti, Tarun TI - Optimal product quality and pricing strategy for a two-period closed-loop supply chain under return policy JO - RAIRO. Operations Research PY - 2022 SP - 3817 EP - 3843 VL - 56 IS - 6 PB - EDP-Sciences UR - https://www.numdam.org/articles/10.1051/ro/2022190/ DO - 10.1051/ro/2022190 LA - en ID - RO_2022__56_6_3817_0 ER -
%0 Journal Article %A Maiti, Tarun %T Optimal product quality and pricing strategy for a two-period closed-loop supply chain under return policy %J RAIRO. Operations Research %D 2022 %P 3817-3843 %V 56 %N 6 %I EDP-Sciences %U https://www.numdam.org/articles/10.1051/ro/2022190/ %R 10.1051/ro/2022190 %G en %F RO_2022__56_6_3817_0
Maiti, Tarun. Optimal product quality and pricing strategy for a two-period closed-loop supply chain under return policy. RAIRO. Operations Research, Tome 56 (2022) no. 6, pp. 3817-3843. doi: 10.1051/ro/2022190
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