Contract design of CLSC with random collection quantity

Abstract

The collection quantity of used product is always affected by some random factors in reality. Hence this paper researches closed-loop supply chain's ordering and contract coordination problem, gives retailer and supply chain's optimal quantity of goods ordered, optimal collection quantity that the retailer promised the manufacturer and optimal profits in decentralized decision and centralized decision on the base of the assumption that the collection quantity of used products is a random variable. In addition, it designs a revenue and expense sharing contract which can coordinate closed-loop supply chain with random collection quantity. © 2012 Springer-Verlag.