Pricing and coordination of competitive recycling and remanufacturing supply chain considering the quality of recycled products

Abstract

<p style='text-indent:20px;'>Considering the quality of recycled products, we develop a game model of a multi-level competitive recycling and remanufacturing supply chain with two manufacturers and multiple recyclers. Being focus on two mainstream game models, namely the manufacturer-recycler cooperation game model and the manufacturer-led Stackelberg game model, we explore the connection between optimal pricing decisions and performance levels of the supply chain members. Although researches indicate that the quality of recycled products will not affect the pricing decisions in the forward supply chain, it is positively related to the recycling price, the repurchase price, and the overall profit in the reverse supply chain, and the intensity of competition among manufacturers or recycled products will affect the pricing decisions and the performance levels of the two models. In the manufacturer-led Stackelberg game model, the supply chain does not reach the Pareto optimum, which uses the recycling cost sharing contract to achieve the coordination. Afterwards, the profits of the two manufacturers and multiple recyclers in the supply chain are increased, and the overall profit of the supply chain system is higher than that of the manufacturer-led Stackelberg game model. Finally, numerical analysis is conducted to verify the proposed coordination mechanism and its effectiveness.</p>