Trade-in strategies in closed-loop supply chain when considering manufacturer entrustment behavior and wholesale price contract

Kailing Liu, Quanxi Li, Haowei Zhang and Zhaohui Dong

Journal of the Operational Research Society, 2025, vol. 76, issue 2, 210-228

Abstract: Many enterprises are implementing trade-in programs through multiple methods, but some lack experience or insufficient conditions to carry out the trade-in program. The previous literature did not consider the impacts of the manufacturer authorizing the third-party information platform (3IP) to implement the trade-in strategy for each member of the closed-loop supply chain. To address this gap, we established three models based on consumer choice behavior: (1) the benchmark model without trade-in strategy; (2) the trade-in model with manufacturer entrustment behavior; (3) the extension model with wholesale price contract. We obtained and compared the equilibrium solutions of the three models. Our results indicate that, compared to the case where there is no entrustment, the manufacturer’s profit is higher if they entrust the 3IP to implement the trade-in program under certain conditions (which is related to the proportion of primary and replacement consumers in the market). Under reasonable circumstances, we find that introducing a wholesale price contract can benefit the manufacturer and increase the profit of the 3IP, stimulate the 3IP to carry out trade-in better, and achieve a win-win situation. Some numerical examples are provided to explain these findings further.

Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/01605682.2024.2338845 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:tjorxx:v:76:y:2025:i:2:p:210-228

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/tjor20

DOI: 10.1080/01605682.2024.2338845

Access Statistics for this article

Journal of the Operational Research Society is currently edited by Tom Archibald

More articles in Journal of the Operational Research Society from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().