Coordination of circular supply chain for online recommerce platform in industry 4.0 environment: a game-theoretic approach

Dharmendra Kumar (), Saurabh Agrawal (), Rajesh Kumar Singh () and Raj Kumar Singh ()
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Dharmendra Kumar: Delhi Technological University
Saurabh Agrawal: Delhi Technological University
Rajesh Kumar Singh: Management Development Institute
Raj Kumar Singh: Delhi Technological University

Operations Management Research, 2023, vol. 16, issue 4, No 23, 2103 pages

Abstract: Abstract In today's customer-oriented sustainable business environment, Industry 4.0 technologies may improve supply chain coordination, although their applicability in recommerce circular supply chain has not been thoroughly explored. The mobile application-based refurbishment company acquires end-of-life/end-of-use items from customers, refurbishes them, and resell them to end-users using an online recommerce platform. This study investigates the effects of extending product life and resource value of end-of-life/end-of-use products on channel performance in the era of industry 4.0. The issue of channel conflicts, pricing of refurbished products, and improving the quality of refurbished items with a warranty has been addressed. A Stackelberg game model is created to find the best supply chain decisions. In addition, we build four alternative scenarios: centralized, decentralized, revenue-sharing, and two-part tariff contract models and compared results to decide which of the scenario is the best. To assess the influence of relevant parameters on decisions, we present a numerical illustration and sensitivity analysis. We analyzed that decentralized channel needs further improvements and can achieve a win–win situation, but not in perfect coordination with a revenue-sharing contract. Our results also showed two-part tariff contract as a perfect coordination scenario i.e., most effective contracting approach for implementing extended producer responsibility regulation in the circular economy.

Keywords: Circular economy; Sustainability; Industry 4.0; Mobile technology; Extended producer responsibility; Coordination (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1007/s12063-023-00384-x

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