Comparison of Cooperation Modes in a Two-Period Closed-Loop Supply Chain System considering Green Manufacturing

Abstract

In order to improve the efficiency of collection and green manufacturing level in a closed-loop supply chain (CLSC) system, the manufacturer invests green manufacturing efforts in product design and production process and intends to cooperate with other CLSC members to achieve excellent performance. In a two-period CLSC system consisting of one manufacturer, one retailer, and one third-service provider, a game-theoretical approach is adopted to compare the optimal decisions and profits of the three green manufacturing cooperation modes, namely, the manufacturer cooperates with the retailer and third-service provider, respectively, and the noncooperation mode is a benchmark. Moreover, the impact of different cooperation modes on CLSC decision-making is analyzed as well. The results indicate that the influence of difference among cooperation modes on CLSC decision is significant, and cooperation is always better than noncooperation. From the perspective of consumers as well as recycling and profit, although the collection rate of used products is not the highest when the manufacturer cooperates with the retailer, the price of product is the lowest and the green property of product is the most obvious; thus, this is regarded as the suitable cooperation mode after a comprehensive analysis. Besides, a coordination mechanism is designed to solve the inefficiency caused by double marginalization. Finally, numerical examples are presented to intuitively observe the relationships between decisions and profits and the impact of different parameters on them in the three modes, and some management inspirations are proposed ultimately.