Research on Green Closed-Loop Supply Chain Considering Manufacturer's Fairness Concerns and Sales Effort

To reduce resource loss and environmental pollution, green CLSC has become a hot issue that manufacturing enterprises pay attention to. In green CLSC, manufacturers would pay attention to the fairness of profit distribution when making sales efforts. Therefore, this paper studies a green closed-loop supply chain (CLSC) considering manufacturer sales efforts and fairness concerns. Then, the centralized model and decentralized model are built and analyzed. Afterward, a profit-sharing contract between members is designed to coordinate the supply chain. We made the following observations: (1) The manufacturers' fairness concerns would reduce product green degree, sales effort and recycling rate of used products, which is not conducive to the sustainable development of the green closed-loop supply chain. (2) When the manufacturers' fairness concerns are gradually strengthened, the optimal decisions would deviate even more from the optimal equilibrium results. (3) When the coefficient of fairness concerns and the ratio of profit-sharing satisfy a certain range, Pareto improvement can be effectively realized.

Automated summary

In order to address resource loss and environmental pollution, manufacturing enterprises are increasingly focusing on green closed-loop supply chain (CLSC). A study was conducted on a green CLSC with considerations of manufacturer sales efforts and fairness concerns. The centralized and decentralized models were analyzed, and a profit-sharing contract was designed to coordinate the supply chain. The findings suggest that fairness concerns among manufacturers may hinder the sustainable development of the green CLSC, and as these concerns are strengthened, the optimal decisions may deviate further from the equilibrium results. However, effective Pareto improvement can be achieved within a certain range of fairness concerns and profit-sharing ratio.