We consider a dynamic closed-loop supply chain made up of one manufacturer and one retailer, with both players investing in a product recovery program to increase the rate of return of previously purchased products. End-of use product returns have two impacts. First, they lead to a decrease in the production cost, as manufacturing with used parts is cheaper than using virgin materials. Second, returns boost sales through replacement items. We show that the coordinated solution can be implemented by using so-called incentive strategies, which have the property of being best-reply strategies if each player assumes that the other is also implementing her incentive strategies. A numerical example illustrates the theoretical results.
Incentive strategies for an optimal recovery program in a closed-loop supply chain / De Giovanni, Pietro; Reddy, Pv; Zaccour, G. - In: EUROPEAN JOURNAL OF OPERATIONAL RESEARCH. - ISSN 0377-2217. - 249:2(2016), pp. 605-617. [10.1016/j.ejor.2015.09.021]
Incentive strategies for an optimal recovery program in a closed-loop supply chain
De Giovanni P;
2016
Abstract
We consider a dynamic closed-loop supply chain made up of one manufacturer and one retailer, with both players investing in a product recovery program to increase the rate of return of previously purchased products. End-of use product returns have two impacts. First, they lead to a decrease in the production cost, as manufacturing with used parts is cheaper than using virgin materials. Second, returns boost sales through replacement items. We show that the coordinated solution can be implemented by using so-called incentive strategies, which have the property of being best-reply strategies if each player assumes that the other is also implementing her incentive strategies. A numerical example illustrates the theoretical results.File | Dimensione | Formato | |
---|---|---|---|
5 Incentive strategies for an optimal recovery program in a closed-loop supply chain.pdf
Solo gestori archivio
Tipologia:
Versione dell'editore
Licenza:
DRM (Digital rights management) non definiti
Dimensione
855.88 kB
Formato
Adobe PDF
|
855.88 kB | Adobe PDF | Visualizza/Apri |
Pubblicazioni consigliate
I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.