Competition or cooperation? Exploring the impact of dominant modes on the competitive relationship in CLSC

Abstract

PurposeThe paper proposes a two-level closed-loop supply chain (CLSC) dynamic competitive model based on different competitive cooperation situations, and explores the impact of competitive cooperation methods on the pricing strategies, recycling and remanufacturing strategies and competitive model selection strategies of supply chain firms.Design/methodology/approachThis paper establishes a CLSC game consisting of a manufacturer and two retailers. Firstly, five CLSC models are established in both horizontal and vertical dimensions, each of which competes with one another. Secondly, the recycling and remanufacturing pricing strategies are analyzed under different competition or cooperation models. Finally, the results are verified through numerical analysis.FindingsThe overall profitability of the CLSC is highest when the manufacturer–retailer partnership alliance is in place. The relationship between retailers and manufacturers is also found to be the best way to achieve overall optimization of the CLSC.Originality/valueThe paper investigates the relationship between the competitive partnership and the total profit of the CLSC, taking into account how to optimize the overall benefit, and focusing on how to optimize the individual interests of each participating enterprise. The results can provide basis and guidance for managers' pricing decision and competition cooperation.