 Supply chain coordination with customer returns and retailer's store brand productWei Li, Jing Chen and Bintong Chen International Journal of Production Economics, 2018, vol. 203, issue C, 69-82 Abstract: We examine a retailer's Stackelberg supply chain, in which the retailer sells a product in the two brands: its own store brand (SB) and a national brand (NB) supplied by a well-established manufacturer. The two brands both face customer returns, and they differ in product quality. We examine the retailer's decision on returns policies for the two brands (either Money Back Guarantee (MBG) or No Refund) and the effects of returns policies on the competition between the two brands. We identify the condition when the retailer should offer MBGs for both brands and we show that MBGs mitigate price competition between the two brands. MBGs are found to enhance the retailer's profit and reduce the NB manufacturer's profit. We examine coordination mechanisms and find that a centralized supply chain intensifies the competition and pushes the NB to reduce its retail price. A simple coordination contract that can achieve supply chain coordination to ensure a win-win for both the retailer and the NB manufacturer is proposed. Keywords: Supply chain management; Customer returns policy; Store brand (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:proeco:v:203:y:2018:i:c:p:69-82 DOI: 10.1016/j.ijpe.2018.05.032 Access Statistics for this article International Journal of Production Economics is currently edited by Stefan Minner More articles in International Journal of Production Economics from Elsevier |
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