Decision research for dual-channel closed-loop supply chain under the consumer's preferences and government subsidies

Based on the consumers' willingness to pay to the characteristics of product, which are composed of physical property and environmental quality, we establish a dual-channel closed-loop supply chain decentralized decision-making model. On this basis, we compare three conditions: no subsidies, subsidies are given to manufacturer and subsidies given to consumers, and analyze the influences of government subsidies and consumers' preferences on the dual-channel closed-loop supply chain. The research indicates: the higher recognition to the physical property of the remanufactured products, the more beneficial (detrimental) to their sales and profit (environment); when consumers hold a low recognition, the manufacturer can simply enter the access to remanufacturing to promote the sales by the improvement of the environmental quality of remanufactured products, leading to a low environmental impact and profit for the decreasing new products; government-subsidized remanufacturing is beneficial (possibly detrimental) to their sales and profit (environment) while subsidies to manufacturers are the same to those to consumers; when consumers hold a high (low) recognition, the government should subsidize (tax). © 2016, Editorial Board of Journal of Systems Engineering Society of China. All right reserved.