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Research on closed loop supply chain with reference price effect

Author

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  • Jie Xu

    (Zhejiang University)

  • Nan Liu

    (Zhejiang University)

Abstract

This paper considers a closed loop supply chain with the manufacturer as the Stackelberg leader. The manufacturer faces three different reverse channels, i.e., (1) manufacturer-managed, (2) retailer-managed, or (3) third party-managed channels. The reference price affects the purchase decision of consumers. Based on game theory, we discuss the reference price effect on the performances across three decentralized reverse channels, and examine the impact of reference price parameter (i.e., reference price coefficient in this paper) on optimal strategies. We conclude that higher reference price coefficient results in lower manufacturer and retailer profits. However, the profit of the third party increases in the reference price coefficient. In addition, some meaningful insights can be derived by comparison without the reference price effect in our models. We found that the scenario without reference price effect is generally superior to that with reference price effect.

Suggested Citation

  • Jie Xu & Nan Liu, 2017. "Research on closed loop supply chain with reference price effect," Journal of Intelligent Manufacturing, Springer, vol. 28(1), pages 51-64, January.
    • Handle: RePEc:spr:joinma:v:28:y:2017:i:1:d:10.1007_s10845-014-0961-0
    DOI: 10.1007/s10845-014-0961-0
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    References listed on IDEAS

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    Cited by:

    1. Yande Gong & Mengze Chen & Yuliang Zhuang, 2019. "Decision-Making and Performance Analysis of Closed-Loop Supply Chain under Different Recycling Modes and Channel Power Structures," Sustainability, MDPI, vol. 11(22), pages 1-26, November.
    2. Sadjady Naeeni, Hannan & Sabbaghi, Navid, 2022. "Sustainable supply chain network design: A case of the glass manufacturer in Asia," International Journal of Production Economics, Elsevier, vol. 248(C).
    3. Ehsan Shekarian & Simme Douwe Flapper, 2021. "Analyzing the Structure of Closed-Loop Supply Chains: A Game Theory Perspective," Sustainability, MDPI, vol. 13(3), pages 1-32, January.
    4. Zhichao Zhang & Qing Zhang & Zhi Liu & Xiaoxue Zheng, 2018. "Static and Dynamic Pricing Strategies in a Closed-Loop Supply Chain with Reference Quality Effects," Sustainability, MDPI, vol. 10(1), pages 1-31, January.
    5. Xiaobao Zhu & Jing Shi & Fengjie Xie & Rouqi Song, 2020. "Pricing strategy and system performance in a cloud-based manufacturing system built on blockchain technology," Journal of Intelligent Manufacturing, Springer, vol. 31(8), pages 1985-2002, December.
    6. Hadi Sahebi & Shayan Ranjbar & Ashkan Teymouri, 2022. "Investigating different reverse channels in a closed-loop supply chain: a power perspective," Operational Research, Springer, vol. 22(3), pages 1939-1985, July.
    7. Xuemei Zhang & Jian Cao & Yang Zhao & Jiansha Lu, 2022. "Fairness Concern in Remanufacturing Supply Chain—A Comparative Analysis of Channel Members’ Fairness Preferences," Sustainability, MDPI, vol. 14(7), pages 1-23, March.
    8. Luttiely Santos Oliveira & Ricardo Luiz Machado, 2021. "Application of optimization methods in the closed-loop supply chain: a literature review," Journal of Combinatorial Optimization, Springer, vol. 41(2), pages 357-400, February.
    9. Chirantan Mondal & Bibhas C. Giri & Sanjib Biswas, 2022. "Integrating Corporate Social Responsibility in a closed-loop supply chain under government subsidy and used products collection strategies," Flexible Services and Manufacturing Journal, Springer, vol. 34(1), pages 65-100, March.
    10. Min Huang & Pengxing Yi & TieLin Shi, 2017. "Triple Recycling Channel Strategies for Remanufacturing of Construction Machinery in a Retailer-Dominated Closed-Loop Supply Chain," Sustainability, MDPI, vol. 9(12), pages 1-19, December.
    11. Yixin Zhang & Xifu Wang, 2021. "Optimal pricing and sourcing strategies in the presence of supply uncertainty and competition," Journal of Intelligent Manufacturing, Springer, vol. 32(1), pages 61-76, January.
    12. Zhang, Jie & Chiang, Wei-yu Kevin, 2020. "Durable goods pricing with reference price effects," Omega, Elsevier, vol. 91(C).
    13. Lingyu Gao & Xiaoli Wang, 2019. "Healthcare Supply Chain Network Coordination Through Medical Insurance Strategies with Reference Price Effect," IJERPH, MDPI, vol. 16(18), pages 1-23, September.

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