The choice of the collection channel in an O2O closed-loop supply chain

This paper builds Stackelberg game models to analyze the pricing and collection decisions of an O2O closed-loop supply chain, either with single or hybrid collection channel. By conducting comparisons among different models, this paper provides the ranking of the optimal selling prices, the optimal collection rates, the manufacturer's optimal profits and the retailer's optimal profits to discuss the choice of the collection channel from the perspectives of the customers, the environment, the manufacturer and the retailer, respectively. This paper reveals that when the single collection channel is applied, the customers, the environment, the manufacturer and the retailer prefer the retailer collection channel. When the hybrid collection channel is used, the customers, the environment and the manufacturer prefer the manufacturer and retailer hybrid collection channel. Nevertheless, the retailer prefers the manufacturer and retailer hybrid collection channel if the collection competition is not intense, while prefers the manufacturer and third party hybrid collection channel if the collection competition is intense. Finally, this paper characterizes the intensity domain of the collection competition for which the hybrid collection channel works better than the single collection channel.

Automated summary

This paper analyzes the pricing and collection decisions of an O2O closed-loop supply chain using Stackelberg game models. The study finds that when a single collection channel is used, different stakeholders prefer the retailer's collection channel. On the other hand, when a hybrid collection channel is used, customers, the environment, and the manufacturer prefer a hybrid collection channel involving both the manufacturer and the retailer. The retailer's preference depends on the intensity of the collection competition.