Pricing decision for new and remanufactured product in a closed-loop supply chain with separate sales-channel

Remanufacturing is a recovery process that transforms a used product into a “like-new” product, which usually comes with a warranty similar to that of the new product. Many manufacturers are concerned that remanufacturing might cannibalize the new products sales. Recent development shows an increasing trend in selling products through non-traditional channels, such as a manufacturers direct channel or an e-channel. A pricing decision model is developed for short life-cycle products in a closed-loop supply chain that consists of the manufacturer, retailer, and collector. The new product is sold via traditional retail stores and the remanufactured product is sold via the manufacturers direct channel. There are two scaling factors introduced in the model: (1) customer acceptance of buying a remanufactured product (reman-acceptance); (2) customer preference for buying a remanufactured product via a direct channel (direct-channel-preference). The results show that implementing a separate channel can improve the total supply chains profit compared to the single-channel approach. It is also found that the two scaling factors influence both the pricing decisions and profits of supply-chain members

Pricing and Remanufacturing Decisions of a Decentralized Fuzzy Supply Chain

The optimal pricing and remanufacturing decisions problem of a fuzzy closed-loop supply chain is considered in this paper. Particularly, there is one manufacturer who has incorporated a remanufacturing process for used products into her original production system, so that she can manufacture a new product directly from raw materials or from collected used products. The manufacturer then sells the new product to two different competitive retailers, respectively, and the two competitive retailers are in charge of deciding the rates of the remanufactured products in their consumers’ demand quantity. The fuzziness is associated with the customer’s demands, the remanufacturing and manufacturing costs, and the collecting scaling parameters of the two retailers. The purpose of this paper is to explore how the manufacturer and the two retailers make their own decisions about wholesale price, retail prices, and the remanufacturing rates in the expected value model. Using game theory and fuzzy theory, we examine each firm’s strategy and explore the role of the manufacturer and the two retailers over three different game scenarios. We get some insights into the economic behavior of firms, which can serve as the basis for empirical study in the future

Pricing decisions for short life-cycle product in a closed-loop supply chain with random yield and random demands

Remanufacturing is a product recovery process that transforms a used product into “like-new” condition. It can extend the useful life of a product and help in reducing waste caused by a huge amount of short life-cycle products. Pricing decisions are an important aspect of successful remanufacturing and can secure the profitability of a firm. Remanufacturing for end-of-use products needs to cope with high uncertainties in terms of the quality and quantity of the acquired product returns. Therefore, after inspection, only a fraction of returns can be recovered through remanufacturing operations. This uncertainty in recovery yield influences the decisions impacting acquisition, wholesale, and retail prices. We propose a pricing model that accommodates the random yield effect of product returns on pricing decisions for short life-cycle products in a closed-loop supply chain. The system consists of a retailer, a manufacturer, and a collector of used-products. We apply a sequential decision approach to determine the optimum pricing decision to maximize supply chain profit, according to a pricing game that places the manufacturer as a Stackelberg leader. We demonstrate the effect of changing parameter values on the wholesale and retail prices as well as on the profitability. The results indicate that the profitability of each player and the supply chain as a whole is affected by the quality of the collected used products, the acquisition price, the shortage penalty, and the remanufacturing costs. Interestingly, reducing variance of random yield results in lower profit for the collector even though the other players and the whole supply chain are better off

Equilibrium Analysis of Channel Structure Strategies in Uncertain Environment

Abstract In this paper, we consider a pricing decision problem with two competing supply chains which distribute differentiated but competing products in the same market. Each chain can be vertically integrated or decentralized based on the choice of the manufacturer. The manufacturing costs, sales costs and consumer demands are characterized as uncertain variables, whose distributions are estimated by experienced experts. Meanwhile, uncertainty theory and game theory are employed to formulate the pricing decision problems. The equilibrium behaviors (how the supply chain members make their own pricing decisions on wholesale prices and retailer markups) at operational level under three possible scenarios are derived. Numerical experiments are also given to explore the impacts of the parameters’ uncertain degrees on supply chain members’ pricing decisions. The results demonstrate that the supply chain uncertain factors have great influences on equilibrium prices. In addition, we also evaluate the effects of competing intensity (substitutability) of the two products on the strategy behaviors, vertically integrated channel strategy versus decentralized strategy, of the manufacturers. It is found that the manufacturers are better off to distribute their products through a decentralized channel rather than an integrated one when the substitutability is greater than some value. Besides, the uncertain factors in the supply chain might reduce the value contrast to the one in deterministic case. Some other interesting managerial highlights are also provided in this paper

An optimal inventory pricing and ordering strategy subject to demand dependent on stock level and price

This article considers the deterministic singular optimal control problem of profit maximisation for inventory replenished at a variable rate and depleted by demand which is assumed to vary with price and stock availability. Optimal policies for the product order rate and price are derived using the maximum principle. Several initial inventory regions are identified as potential inventory states for feasible profit optimisation. Bounds on the maximum price for maximising net profit or minimising loss are obtained. Numerical simulations accompanied by phase diagrams are performed to support the theoretical findings

An overview of fuzzy techniques in supply chain management: bibliometrics, methodologies, applications and future directions

Every practice in supply chain management (SCM) requires decision making. However, due to the complexity of evaluated objects and the cognitive limitations of individuals, the decision information given by experts is often fuzzy, which may make it difficult to make decisions. In this regard, many scholars applied fuzzy techniques to solve decision making problems in SCM. Although there were review papers about either fuzzy methods or SCM, most of them did not use bibliometrics methods or did not consider fuzzy sets theory-based techniques comprehensively in SCM. In this paper, for the purpose of analyzing the advances of fuzzy techniques in SCM, we review 301 relevant papers from 1998 to 2020. By the analyses in terms of bibliometrics, methodologies and applications, publication trends, popular methods such as fuzzy MCDM methods, and hot applications such as supplier selection, are found. Finally, we propose future directions regarding fuzzy techniques in SCM. It is hoped that this paper would be helpful for scholars and practitioners in the field of fuzzy decision making and SCM

Sustainability Analysis under Disruption Risks

Resilience to disruptions and sustainability are both of paramount importance to supply chains. This paper presents a hybrid methodology for the design of a sustainable supply network that performs resiliently in the face of random disruptions. A stochastic bi-objective optimization model is developed that utilizes a fuzzy c-means clustering method to quantify and assess the sustainability performance of the suppliers. The proposed model determines outsourcing decisions and buttressing strategies that minimize the expected total cost and maximize the overall sustainability performance in disruptions. Important managerial insights and practical implications are obtained from the model implementation in a case study of plastic pipe industry

Supply Chain

Traditionally supply chain management has meant factories, assembly lines, warehouses, transportation vehicles, and time sheets. Modern supply chain management is a highly complex, multidimensional problem set with virtually endless number of variables for optimization. An Internet enabled supply chain may have just-in-time delivery, precise inventory visibility, and up-to-the-minute distribution-tracking capabilities. Technology advances have enabled supply chains to become strategic weapons that can help avoid disasters, lower costs, and make money. From internal enterprise processes to external business transactions with suppliers, transporters, channels and end-users marks the wide range of challenges researchers have to handle. The aim of this book is at revealing and illustrating this diversity in terms of scientific and theoretical fundamentals, prevailing concepts as well as current practical applications

A comprehensive review of hybrid game theory techniques and multi-criteria decision-making methods

More studies trend to hybrid the game theory technique with the multi-criteria decision-making (MCDM) method to aid real-life problems. This paper provides a comprehensive review of the hybrid game theory technique and MCDM method. The fundamentals of game theory concepts and models are explained to make game theory principles clear to the readers. Moreover, the definitions and models are elaborated and classified to the static game, dynamic game, cooperative game and evolutionary game. Therefore, the hybrid game theory technique and MCDM method are reviewed and numerous applications studied from the past works of literature are highlighted. The result of the previous studies shows that the fundamental elements for both frameworks were studied in various ways with most of the past studies tend to integrate the static game with AHP and TOPSIS methods. Also, the integration of game theory techniques and MCDM methods was studied in various applications such as politics, economy, supply chain, engineering, water management problem, allocation problem and telecommunication network selection. The main contribution of the recent studies of employment between game theory technique and MCDM method are analyzed and discussed in detail which includes static and dynamic games in the non-cooperative game, cooperative game, both non-cooperative and cooperative games and evolutionary gam