Decision-making And Coordination In A Closed-loop Supply Chain Under Different Dominant Modes With The Consideration Of Fairness

Closed-loop Supply Chain(CLSC) management has been adopted by an increasing number of companies because of setting up collection systems and remanufacturing process. In order to facilitate remanufacturing process and enhance the market demand, companies will input continuous collection effort and sales effort. Since that the demand is related to retail price, collection effort and sales effort, the performance of the CLSC depends on the pricing and effort level. Considering that the channel dominant mode and members' fairness preference exert great influence on the performance of the CLSC, this dissertation aims to explore the optimal pricing, collection effort, sales effort decisions and the coordination of the CLSC with different dominant modes, under the condition of non-fairness preference and fairness preference. The content of this dissertation are as follows:First, research on decision-making and coordination of the CLSC with different dominant modes under the condition of non-fairness preference. In a CLSC with one self-interested manufacturer and one self-interested retailer, by the use of game theory, the optimal pricing, effort decisions and profits are derived under centralized decision-making and decentralized decision-making with manufacturer Stackelberg, vertical Nash and retailer Stackelberg. The equilibrium results are compared and the low price promotion contract is proposed to coordinate the decentralized CLSC. Numerical example is then presented.Results show that the retailer will always benefit from the dominant power shifting from the manufacturer to the retailer, while the manufacturer may also benefit. The best dominant mode for the CLSC depends on the demand expansion effectiveness of collection effort. When it is relatively low, CLSC with the symmetric channel power mode is the most profitable; otherwise, the CLSC with dominant retailer is the best. The proposed low price promotion contract can effectively coordinate the CLSC.Second, research on decision-making and coordination of the CLSC with different dominant modes under the condition of fairness preference. In a CLSC with one fair-minded manufacturer and one fair-minded retailer, by the use of game theory, the optimal pricing, effort decisions and profits are derived under CLSC with different dominant modes and low price promotion contract. The equilibrium results are analyzed and the numerical example is studied.Results show that fairness preference(both the sympathy and the jealousy) are beneficial to fair allocation of profits, compared with the condition of non-fairness preference. The sympathy plays a greater role in enhancing the profit and utility of the disadvantaged member, while the jealousy exerts a greater influence on lowering the profit and utility of the advantaged member. The increasing sympathy is conducive to the performance of the CLSC, realizing fairness allocation with high profits; yet it is not the case for jealousy. The proposed low price promotion contract can also coordinate the CLSC under the condition of fairness preference with appropriate channel payment charged by the retailer.Therefore, companies should actively exert collection effort or sales effort, and collaborate with each other to achieve mutual benefit, instead of blindly pursuing the dominant position. The advantaged company should improve their sympathy to reduce the adverse effects of the increasing jealousy of disadvantaged company on the company and the CLSC, and strengthen the partner relationship to improve the overall performance.