Study on Revenue Sharing and Coordination Mechanism of the Closed Loop Supply Chain Based on Nash Negotiation Model and Buyback Contract

The paper discusses revenue sharing and coordination mechanism of the reverse logistics including a manufacturer and a retailer who experiences stochastic demand. On the base of optimization models designed, the optimal order quantity and the optimal price at which the producer buybacks the retailer´s surplus commodities are acquired. As a result of the revenue sharing and coordination mechanism based on Nash negotiation model and buyback contract, profit of the close loop supply chains can be maximized and coordination of its members can be realized. Finally, a mathematics model is given to verify the conclusions.