Pricing Decisions in a Competitive Closed-Loop Supply Chain with Duopolistic Recyclers

Abstract

In this study, we consider a three-echelon closed-loop supply chain consisting of a manufacturer, a collector, and two duopolistic recyclers. In the supply chain, the collector collects end-of-life products from consumers in the market. Then, both recyclers purchase the recyclable waste from the collector, and each recycler turns them into new materials. The manufacturer has no recycling facilities; therefore, the manufacturer only purchases the recycled and new materials for its production from the two recyclers. Under this scenario, price competition between recyclers is inevitable. With two pricing structures (Nash and Stackelberg) of the leaders group and three competition behaviors (Collusion, Cournot, and Stackelberg) of the followers group, we suggest six different pricing game models. In each of them, we establish a pricing game model among the members, prove the uniqueness of the equilibrium prices of the supply chain members, and discuss the effects of competition on the overall supply chain’s profitability. Our numerical experiment indicates that as the price competition between recyclers intensifies, the supply chain profitability decreases. Moreover, the greater the recyclability degree of the waste is, the higher the profits in the supply chain become.

The Impact of Green Technology Investment Levels on Competitive Supply Chain Integration Decisions

“…Lee conducted an analysis of a third-order closed-loop supply chain comprising a manufacturer, a collector, and two duopoly recyclers. The findings of the study revealed that heightened price competition among recyclers had an adverse impact on the overall profitability of the supply chain [30]. Seyedhosseini et al conducted an analysis to examine the impact of different vertical game structures and the competitive game behaviours of two duopoly retailers on the overall profitability of the supply chain, the profitability of individual participants, and the optimal strategy.…”

Effect of Optimal Subsidy Rate and Strategic Behaviour of Supply Chain Members under Competition on Green Product Retailing

“…In this direction, one can categorize the number of publishing articles into two groups. In the first groups, researchers mainly focused on the effect the information asymmetry in SC competition [31], Ai et al [32], Bian et al [33], Lee [34], and others. e authors explored optimal decisions mostly in a single game structure under price-dependent demand and explored the effect of information asymmetry in decentralized and centralized settings.…”

Pricing games of duopoly service-inventory systems with lost sales

“…We consider three types of pricing games: (i) a parallel pricing game, (ii) a sequential pricing game, and (iii) a unified pricing game. Duopoly markets consisting of two competitors can be found in various applications including supply chains [8,16], peak-load pricing [5], and two-tier service systems. An example of two-tier service is public healthcare service, which comprises free and paid service providers [17].…”