Due to the increasing number of end-of-life (EOL) products and their related environmental concerns, much attention has been paid to reverse logistics. In this paper, we consider a two-echelon reverse supply chain (RSC) with one manufacturer and one retailer who try to improve sustainable consumption by increasing customers’ willingness to return used products through offering a discount or a direct fee in exchange for bringing back EOL products. Afterward, the model is extended to consider a closed loop supply chain (CLSC). Quantity discounts and increasing fee contracts are proposed to coordinate supply chains. Then, government role in improving coordinated supply chains through donating different incentives (tax exemption and subsidy) to supply chain members are analyzed. Results show that total channel profit in the coordinated case is improved. Also, in the proposed models, each member has enough motives to participate in the plan. In addition, results demonstrate that government-sponsored incentives to the manufacturer are preferred to the retailer.

Reverse and closed loop supply chain coordination by considering government role

Analyzing structure of two-echelon closed-loop supply chain for pricing, quality and recycling management

Research on low-carbon strategies in supply chain with environmental regulations based on differential game

Sustainable supply chain management towards disruption and organizational ambidexterity: A data driven analysis

A multi-objective robust optimization model for site-selection and capacity allocation of municipal solid waste facilities: A case study in Tehran

Data capital investment strategy in competing supply chains

Outsourcing or reshoring? A manufacturer's sourcing strategy in the presence of government subsidy

Optimal strategies for production plan and carbon emission reduction in a hydrogen supply chain under cap-and-trade policy

Recently, a new trend has arisen in which many original equipment manufacturers (OEMs) outsourced to traditional low-cost manufacturing bases (e.g., China) have started to transfer production to new emerging regions with even lower costs (e.g., Southeast Asia). However, it is still unclear whether and when OEMs should transfer to the new environment, especially when taking the traditional supplier's initial innovation effort into consideration. To address this question, we consider a sourcing game where one OEM sources from a traditional low-cost supplier that can be either competitive (CS) or noncompetitive (NS) initially. Moreover, both of these types of suppliers have the ability to innovate by themselves. Driven by the increasing cost pressure, the OEM may transfer to a new supplier (LS) that has an even lower cost but suffers yield uncertainty. The equilibrium results show that the OEM is less likely to transfer when its brand value is large enough. Interestingly, we find that the competition between the CS and OEM does not always prompt the OEM to transfer. When the brand advantage is large enough and the traditional supplier's unit production cost for the OEM is moderate, the OEM should not transfer under the CS scenario but should transfer under the NS scenario. Finally, we find that when the OEM's brand advantage increases, the effectiveness of innovation in preventing the OEM from transferring decreases under the CS scenario, while it increases under the NS scenario. 

To Transfer or Not? Analysis of the Original Equipment Manufacturer's Strategic Outsourcing Strategy in the Presence of the Supplier's Innovation Effort

Lei Xie

Papers

Data capital investment strategy in competing supply chains

Outsourcing or reshoring? A manufacturer's sourcing strategy in the presence of government subsidy

Optimal strategies for production plan and carbon emission reduction in a hydrogen supply chain under cap-and-trade policy

To Transfer or Not? Analysis of the Original Equipment Manufacturer's Strategic Outsourcing Strategy in the Presence of the Supplier's Innovation Effort