Hybrid closed-loop supply chains with competition in recycling and product markets

This paper considers a closed-loop supply chain (CLSC) with competitive recycling-market (competitive collectors) and product-market (new and remanufactured products). Three competition scenarios chosen by the manufacturer are studied in this paper. First, the manufacturer does not establish a complete CLSC, and the remanufacturer takes the entire recycling business instead. Second, the manufacturer chooses to establish its own collecting networks, and the manufacturer and remanufacturer compete in the recycling market. Third, the manufacturer chooses to outsource the collecting business to the retailer, and the retailer and remanufacturer compete in the recycling market. We use Stackelberg gaming models to study the optimal pricing strategies for all three individuals and their attitudes toward different scenarios. Finally, numerical analysis is presented. We generate our findings from three aspects, as follows: the manufacturer's recycling choice, supply chain control-lability, and influence on retailers and remanufacturers. We find that the manufacturer will always choose to recycle and remanufacture used products, and the collecting channel depends on the unit cost of self-collecting and the compensation from outsourcing-collecting. The collecting-outsourcing strategy causes the retailer to be more willing to reduce the price, but the remanufacturer would like the manufacturer to choose collecting self-implementation, and considering the controllability and predictability of pricing strategies, the manufacturer is also willing to recycle itself.