Joint Capacity Investment, Collecting and Pricing Decisions in a Capacity Constraint Closed-Loop Supply Chain Considering Cooperation

Jian Wang and Wenxuan Shao
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Jian Wang: School of Artificial Intelligence and Automation, Huazhong University of Science and Technology, Wuhan 430074, China
Wenxuan Shao: School of Artificial Intelligence and Automation, Huazhong University of Science and Technology, Wuhan 430074, China

Sustainability, 2021, vol. 13, issue 16, 1-28

Abstract: In this paper, a closed-loop supply chain (CLSC) consisting of one manufacturer and one supplier is considered. The capacity of the manufacturer is limited, the manufacturer can increase capacity by investing in capacity, and there are different cooperation contracts among the supply chain members. This paper pushes collecting activities upstream, assumes that the collecting activity can be completed by the supplier, and accepts that there is cooperation between the members, which increases supplier involvement. Dynamic game models among CLSC members are formulated. The optimal decisions of pricing, capacity investment, and collecting channels of the CLSC members are obtained, and the impacts of some important factors, for example, the capacity investment cost coefficient and the cost-sharing factors, on optimal decisions are investigated. The results reveal that the supplier collecting mode performs better in some scenarios; therefore, the management enlightenment desired by the supplier can be obtained. Additionally, the coordination between the manufacturer and the supplier sometimes fails to increase the closed-loop supply chain’s sustainability, which is a finding quite different from some current research results.

Keywords: closed-loop supply chain; dual recycling channel; capacity constraint; capacity investment; coordination (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
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