The Influence Of Altruistic Preference And Sales Effort On Closed-loop Supply Chain Decision Making

With the improvement of people’s living standards and the change of consumption habits,consumer demand is constantly enriched.In order to meet consumer demand and grab market share,enterprises continue to launch personalized and diversified products.Rapid product upgrading leads to a large number of waste products,which will not only waste resources,but also have a negative impact on the environment.In this context,all parties in the society are trying to seek a sustainable development model that gives consideration to both economic and environmental benefits.As an important method to realize circular economy,closed-loop supply chain can reduce resource input and waste discharge through maintenance and remanufacturing of waste products.With the development of remanufacturing,retailers have begun to get involved in remanufacturing.However,due to the low consumer recognition of the remanufactured products,the remanufactured products are faced with the problem of sales difficulties.Therefore,sales efforts can be made through advertising and setting up display and trading platforms to guide consumers to take the initiative to purchase the remanufactured products.At the same time,supply chain members always pay attention to the fairness of channel profit distribution.When the profit distribution gap between the dominant company and the subordinate company is too large,the subordinate company will take measures to punish the dominant company,and even cause the supply chain to be interrupted.Therefore,considering the stability and growth of supply chain,dominant company tends to adopt a certain degree of altruistic preference when making decisions.Based on this,this paper takes the closed-loop supply chain composed of a single manufacturer and a single retailer as the research object,considering the new product and remanufactured product differential pricing,respectively constructs four models: based model of closed-loop supply chain(without altruistic preference or sales effort),with altruistic preference but without sales effort,without altruistic preference but with sales effort,with altruistic preference and sales effort.By comparing the optimal price,demand,profit and other factors of different models,the influence of altruistic preference,sales effort and their combination on closed-loop supply chain decision-making is explored.The study found that:(1)Manufacturer adopts altruistic preference,which will benefit retailer by reducing patent license fee of remanufactured product and wholesale price of the new product.Meanwhile,retailer will reduce the sales price of new products and remanufactured products to stimulate the demand for new products and remanufactured products.Manufacturer’s altruistic preference will increase the profits of both the retailer and the closed-loop supply chain.(2)The retailer’s sales efforts for remanufactured products will increase the patent license fee,sales price and market demand of the remanufactured products.The wholesale price and sales price of new products are not affected by retailers’ sales efforts.However,as the increase in demand for remanufactured products has eroded part of the new product market,the demand for new products has fallen.If the retailer controls the sales effort level within a certain critical value,all participating members of the closed-loop supply chain will benefit.(3)Under the dual influence of altruistic preference and sales effort,the wholesale price and sales price of new products have decreased,and the demand for remanufactured products has increased,but the change of patent license fee,sales price of remanufactured products and the demand for the new products are uncertain.Manufacturer and retailer can increase profits by setting reasonable altruistic preferences and sales effort.This paper not only supplements the relevant research on supply chain decision-making under different remanufacturing subjects,but also enrichs the research on altruistic preference and sales effort in closed-loop supply chain decision-making,and provides the decision-making basis for retailers to undertake the recycling and remanufacturing of closed-loop supply chain members.