A game theoretic approach for pricing under a return policy and a money back guarantee in a closed loop supply chain

Assarzadegan, Parisa; Rasti−Barzoki, Morteza

doi:10.1016/j.ijpe.2019.09.007

Cited by 40 publications

(23 citation statements)

References 40 publications

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“…Most of the papers considered the leadership effect of only one party in the developed CLSCs (e.g., manufacturer [12,106,107], supplier [108][109][110][111][112], retailer [113][114][115], remanufacturer [116,117]). The studies prioritized the manufacturer's role as the leader, such as in real situations (e.g., national manufacturing brands), they are often bigger as compared with other players and probably have stronger risk tolerances.…”

Section: Game-based Clscsmentioning

confidence: 99%

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Analyzing the Structure of Closed-Loop Supply Chains: A Game Theory Perspective

Shekarian

Flapper

2021

Sustainability

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Closed-loop supply chains (CLSCs) are seen as one of the circular economy’s leading approaches for reducing our natural environment load. Many CLSC models require collaboration among different parties. Game theory (GT) offers a way to consider the profits of all parties in a CLSC, providing insight into the costs and benefits to the involved parties in an objective and quantitative way. Presently, available reviews on the use of GT, in the context of CLSC, are quite limited and consider only a few relevant elements. Here, we present a new and more extensive framework, focusing on the collaboration structure of CLSCs. It contains a content-based analysis of 230 papers based on a four-step systematic literature review process. The characteristics studied are channels for collection, reprocessing and selling, the planning horizon, and the types of games. The structures found are graphically reviewed, leading to 196 different structures. The results show that, so far, most attention has been paid to the dual-channel collection, where collection by two retailers (dual-retailer) is the most studied case. With respect to selling, most attention has been paid to situations with two selling channels (dual-selling), i.e., one channel managed by a manufacturer and one channel managed by a remanufacturer. Studies have prioritized the role of manufacturers as that of the leader and collector. Finally, a number of directions for further research are pointed out.

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Section: Game-based Clscsmentioning

confidence: 99%

“…Overall, this paper suggested a general framework for studying game theory's contribution to CLSC models. Similarly, this procedure can be applied to analyze the recently developed models [106,112,270,271,276] in this context.…”

Section: Future Research Directionsmentioning

confidence: 99%

Analyzing the Structure of Closed-Loop Supply Chains: A Game Theory Perspective

Shekarian

Flapper

2021

Sustainability

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“…Assarzadegan and Rasti-Barzoki (2019) [1] introduced CLSC (Closed Loop Supply Chain) including one producer and two sellers in which sold products can be returned in two groups of defective and non-defective items. In the first scenario the producer pays to the retailer 1, the price for defective product, and in the second one the producer pays the first retailer's price in order to motivate him to offer Money Back Guarantee for defective products.…”

Section: Pricing With the Refund Policymentioning

confidence: 99%

Bundle Pricing, Reservation and Refund Policies in a Two-Level Supply Chain

2021

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Refunding and bundling reservation are known as two popular methods to increase profit where in recent years have gained attention of researchers. One main application of refunding policy emerges for online product sale methods, where consumers can be refunded by returning goods which are not favorite according to their interest. Examining three scenarios including refunding, bundle reservation and refunding along with bundle reservation policies, we will investigate a model for each corresponding scenario. We try to compare two refund and bundle reservation pricing policies in a two-level supply chain including one manufacturer and one wholesaler, and we provide a combined model including two products. The demand is constant and also the population-related information about the division of the population into two types of consumers, strategic consumers (consumers who can predict the second stage discount) and myopic consumers (consumers who can not predict the second stage discount) are available. In addition, the percentage of consumers who refund the product due to regret, the inability to install the product or other reasons, is constant and is independent of the amount of refund. We show that the combined model is optimal and has a higher profit margin than any other policy alone.

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“…For example, money-back guarantee influences consumer choice deeply by significantly increasing the relative preference. [33][34][35] However, increasing product returns brings more challenges on how to manage inventory effectively. And most of the studies on product returns in supply chain management have assumed that retailers are endowed with sufficient capital while ignoring the impact of capital constraints.…”

Section: Literature Reviewmentioning

confidence: 99%

Financing decisions in a supply chain when considering product returns

Luo

2021

Appl Stoch Models Bus & Ind

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As more and more products are sold, the management of product returns plays a significant role in firms' operational decisions. We consider a capital-constrained newsvendor model to explore the impact of product returns on firms' operational and financial decisions, in which a capital-constrained retailer can get financed from either banks or suppliers and refurbish returned products and resell them to customers. Our findings show that offering refurbishment for returned products can increase the retailer's order quantity and improve the capital-constrained supply chain performance. Moreover, the supplier strategically designs the wholesale price to hinder the retailer refurbishing returned products although the retailer always chooses to provide refurbishment under trade credit. When only trade credit financing is available, there exists a Pareto improvement on both partners' profits under certain cases. In addition, we investigate the financing preferences of the supply chain and find that product returns have a significant influence on the unique financing equilibrium. Finally, we conduct numerical analyses to present the impacts of some key parameters on the performance of both supply chain members.

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A game theoretic approach for pricing under a return policy and a money back guarantee in a closed loop supply chain

Cited by 40 publications

References 40 publications

Analyzing the Structure of Closed-Loop Supply Chains: A Game Theory Perspective

Analyzing the Structure of Closed-Loop Supply Chains: A Game Theory Perspective

Bundle Pricing, Reservation and Refund Policies in a Two-Level Supply Chain

Financing decisions in a supply chain when considering product returns

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