Managing Channel Profit and Total Surplus in a Closed-Loop Supply Chain Network

Jena, S. Ghadge, A. and Sarmah, S. (2017), “Managing channel profit and total surplus in a closed-loop supply chain network”, Journal of Operational Research Society, Forthcoming.

23 Pages Posted: 11 Oct 2017 Last revised: 23 Oct 2017

See all articles by S. Jena

S. Jena

Independent

Abhijeet Ghadge

Cranfield University - School of Management

S. Sarmah

Independent

Date Written: October 10, 2017

Abstract

Today’s government is interested in the product recovery program in order to encourage sustainability. The research develops four closed-loop supply chain models by considering different scenarios for the governmental subsidies and fees under price sensitive demand. Analytical results suggest that the government should provide subsidies to both manufacturer and collector in order to maximize channel profit and total surplus. Higher subsidies advocates manufacturer’s intention to lean towards remanufacturing activities under given manufacturing and consumption fees scenarios. The sensitivity analysis reveals that the total surplus and channel profit increases as subsidies increase in all closed-loop supply chain models.

Keywords: Closed-loop Supply chain

Suggested Citation

Jena, S. and Ghadge, Abhijeet and Sarmah, S., Managing Channel Profit and Total Surplus in a Closed-Loop Supply Chain Network (October 10, 2017). Jena, S. Ghadge, A. and Sarmah, S. (2017), “Managing channel profit and total surplus in a closed-loop supply chain network”, Journal of Operational Research Society, Forthcoming. , Available at SSRN: https://ssrn.com/abstract=3050702

S. Jena

Independent

Abhijeet Ghadge (Contact Author)

Cranfield University - School of Management ( email )

Bedfordshire, MK43 0AL
United Kingdom

S. Sarmah

Independent

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