Two-Period Price Management for Closed-Loop Supply Chain

In a closed-loop supply chain, the manufacturer makes new products and sells them by the retailer in the first period, reclaims used-products by the retailer in the second period. But the supply of used-products is affected not only by the amount of new products that sold to the consumer market, but also by the end-customerpsilas willingness that is affected by the difference between the end-customerpsilas valuation for the used-product and the collecting price of the used-product. In this paper, considering the relationship of the consumer market of the new products and the supply market of the used-products, the end-customerpsilas valuation for the used-product, we present two-period price decisions for the new product and the used-product, show a numerical example to illustrate the optimal results and give the analysis of the optimal results. By our study, we find that the manufacturer and the retailer must pay more attention to the observation of the end-customerpsilas sensitivity coefficient of the collecting price and the end-customerpsilas valuation for the used-products in order to obtain the expected profit.