Managing economic and social profit of cooperative models in three-echelon reverse supply chain for waste electrical and electronic equipment

doi:10.1007/s11783-017-0999-2

Front. Environ. Sci. Eng.

2017, Vol. 11

Issue (5) : 12 https://doi.org/10.1007/s11783-017-0999-2

RESEARCH ARTICLE

Managing economic and social profit of cooperative models in three-echelon reverse supply chain for waste electrical and electronic equipment

Jian Li^1,², Zhen Wang¹, Bao Jiang¹(

)

¹. College of Economics, Ocean University of China, Qingdao 266100, China
². Marine Development Studies Institute, Ocean University of China, Qingdao 266100, China

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Abstract

The four model of a three-echelon reverse supply chain (RSC) for WEEE are studied.

Optimal coordination strategies in four models are compared.

The model C make the RSC of WEEE achieve maximum economic and social benefit.

Duopolistic retailers make the RSC achieve maximum economic and social benefit.

In addition to maximizing economic benefits, reverse supply chains should further seek to maximize social benefits by increasing the quantity of waste electrical and electronic equipment (WEEE). The paper investigates cooperative models with different parties in a three-echelon reverse supply chain for WEEE consisting of a single collector, a single remanufacturer, and two retailers based on complete information. In addition, the optimal decisions of four cooperative models and the effect of the market demand of remanufactured WEEE products and the market share of two retailers on the optimal decisions are discussed. The results indicate that optimal total channel profit and recycle quantity in a reverse supply chain are maximized in a centralized model. The optimal total channel profit and recycle quantity increase with an increase in the market demand of remanufactured WEEE products. The three-echelon reverse supply chain consisting of duopolistic retailers maximizes total channel profit and recycle quantity in a reverse supply chain for WEEE.

Keywords Waste electrical and electronic equipment (WEEE) Reverse supply chains Recycle quantity Social benefit Cooperative models Duopolistic retailers

Corresponding Author(s): Bao Jiang

Issue Date: 06 November 2017

Cite this article:

Jian Li,Zhen Wang,Bao Jiang. Managing economic and social profit of cooperative models in three-echelon reverse supply chain for waste electrical and electronic equipment[J]. Front. Environ. Sci. Eng., 2017, 11(5): 12.

URL:

https://academic.hep.com.cn/fese/EN/10.1007/s11783-017-0999-2
https://academic.hep.com.cn/fese/EN/Y2017/V11/I5/12

Fig.1 The completely decentralized model (Model D)

Fig.2 The remanufacturer and retailer cooperative model (Model RR)

Fig.3 The remanufacturer and collector cooperative model (Model RC)

Fig.4 The centralized model (Model C)

$w r p$ :	wholesale price per unit to two retailers determined by the remanufacturer ($/unit)
$w c p$ :	wholesale price per unit to collector determined by the remanufacturer ($/unit)
$c 3$ :	marginal cost per unit of the collector ($/unit)
$c 4$ :	marginal cost per unit of the remanufacturer ($/unit)
$c r i$ :	marginal cost per unit of the retailer- i ($/unit), where i = 1, 2
$p i$ :	sale price per unit charged to customer by the retailer- i($/unit), where i = 1, 2
$D i$ :	market demand of the remanufacturing products of retailer- i (unit), it can be expressed as $D i = α i − α i p i + β p 3 − i$ [¹⁵], where $α i$ is the market size of retailer- i, $α i$ >0; $α i$ denotes the measure of sensitivity of retailer- i's sales to changes of the retailer- i's price; $β$ is the degree of substitutability between retailers, where $β > 1$ , i=1, 2
$f$ :	price per unit paid to customer by the collector ($/unit)
$r (f)$ :	recycle?quantity (unit), it can be expressed as $r (f) = a + b f$ [³¹], where $a > 0$ , $b > 0$
$π j$	total channel profit of model j , where j = D, RR, RC, C

Tab.1

Fig.5 Influence of (a₁+a₂) on the optimal total channel profit and recycle quantity

Fig.6 Influence of (a₁/a₂) on the optimal total channel profit and recycle quantity

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