Multi-Period E-Closed-Loop Supply Chain Network Considering Consumers’ Preference for Products and AI-Push
Abstract
:1. Introduction
- For economic performance, when consumers’ preference for products and AI-push are static and dynamic situations, how do they affect the profits of manufacturers and remanufacturers?
- For enterprise management, how can manufacturers and remanufacturers positively respond and feedback for the influence of E-CLSCN through consumers’ preference for products and AI-push, to promote the stable operation of enterprises and the whole E-CLSCN?
- For environmental sustainability, how should the government and enterprises take effective measures to promote the development of E-CLSCN, to improve the sustainable use of resources?
2. Literature Review
2.1. Supply Chain Considering Consumers’ Preference
2.2. E-Channel Supply Chain and Promotion Activities under E-Channel
2.3. Supply Chain Network and Sustainable Supply Chain
2.4. CLSC and CLSCN
3. Assumptions and Notations
3.1. The Problem Statement and Related Assumptions
3.2. The Problem Statement and Related Assumptions
4. Model Establishment
4.1. Optimal Behavior and Equilibrium of Manufacturers
4.2. Optimal Behavior and Equilibrium of Remanufacturers
4.3. Optimal Behavior and Equilibrium of Demand Markets
4.4. Multi-Period E-CLSCN Equilibrium Model
- The number of NP, which manufacturers are willing to retail the demand markets, is equal to the number of NP that the demand markets are willing to buy. The number of RP between remanufacturers and demand markets has the same trend.
- The price of the NP, which the retail price of manufacturers is the same as the price of consumers are willing to pay. The price of RP between remanufacturers and demand markets has the same trend.
- The price of the EOL products, which the collecting price of remanufacturers is equal to the negative utility of consumers.
5. Numerical Examples
- When the consumers’ preference for products and the manufacturers’(remanufacturers’) AI-push are static at planning periods, this paper compares and analyze the profits of manufacturers, remanufacturers and whole E-CLSCN.
- The consumers’ preference for products and the manufacturers’(remanufacturers’) AI-push are dynamic at planning periods, this paper compares and analyze the profits of manufacturers, remanufacturers and whole E-CLSCN.
5.1. Numerical Example 1
5.2. Numerical Example 2
6. Discussion of Results and Managerial Insights
6.1. Discussion of Results
6.2. Managerial Insights
6.2.1. The Perspective of the Government
- When consumers’ preference for RP is higher, the government should increase the minimum recovery for EOL products (increase the patent fees), reduce the subsidies for remanufacturers, and give the subsidies for manufacturers. Moreover, the government should increase subsidies for remanufacturers’ AI-push, which can increase the development of E-CLSCN.
- When the consumers’ preference for NP is higher, the government should increase the subsidies for collection EOL products by remanufacturers, reduce the patent fees and subsidies for consumers to purchase the RP.
6.2.2. The Perspective of Manufacturers and Remanufacturers
7. Conclusions, Limitations and Future Direction
7.1. Conclusions
- (1)
- For supply chain management, this paper enriches the research scope of CLSCN and effectively promoted the level of closed-loop supply chain management.
- (2)
- For policymakers (government), this paper gives the government a reference when developing dynamic intervention and subsidy mechanisms.
- (3)
- For policy-implementers (enterprise), in the process of maximizing the economic interests of enterprises, how to balance environmental protection and government policies, this paper provides a reference for enterprises to develop dynamic strategic mechanisms from a new perspective.
- (4)
- For sustainability, this paper helps manufacturers and remanufacturers improve their performance while providing advice to the government on optimizing the remanufacturing industry. Therefore, it is conducive to enhance the development of the remanufacturing industry in E-CLSCN. Ultimately achieving supply chain management sustainability, economic sustainability, and environmental sustainability.
7.2. Limitations and Future Direction
Author Contributions
Funding
Acknowledgments
Conflicts of Interest
Appendix A
- (1)
- Information about respondents to the questionnaire.
- (2)
- Preferences and actual purchase behavior for RP.
- (3)
- Respondents believe or do not believe that remanufacturing products contribute to the sustainable development of resources.
- (4)
- For the sustainable development of resources, respondents are willing to participate in recycling and remanufacturing operations in the future.
Option | Subtotal | Proportion |
Yes | 582 | 88.85% |
No | 73 | 11.15% |
This question is valid for the number of times | 655 |
Option | Subtotal | Proportion |
Yes | 307 | 46.87% |
I don’t know if I bought a remanufactured product or not | 154 | 23.51% |
I’ll consider buying in the future. | 183 | 27.94% |
I will not consider buying in the future | 11 | 1.68% |
This question is valid for the number of times | 655 |
Option | Subtotal | Proportion |
New product | 349 | 53.28% |
Remanufactured product | 306 | 46.72% |
This question is valid for the number of times | 655 |
Option | Subtotal | Proportion |
Satisfied | 354 | 54.05% |
Dissatisfied | 301 | 45.95% |
This question is valid for the number of times | 655 |
Option | Subtotal | Proportion |
Yes | 551 | 84.12% |
No | 104 | 15.88% |
This question is valid for the number of times | 655 |
Option | Subtotal | Proportion |
Yes | 298 | 45.5% |
No | 357 | 54.5% |
This question is valid for the number of times | 655 |
Option | Subtotal | Proportion |
Yes | 591 | 90.23% |
No | 64 | 9.77% |
This question is valid for the number of times | 655 |
Option | Subtotal | Proportion |
Yes | 278 | 42.44% |
No | 105 | 16.03% |
I don’t know | 272 | 41.53% |
This question is valid for the number of times | 655 |
Option | Subtotal | Proportion |
Yes | 558 | 85.19% |
No | 97 | 14.81% |
This question is valid for the number of times | 655 |
Option | Subtotal | Proportion |
Yes | 571 | 87.18% |
No | 84 | 12.82% |
This question is valid for the number of times | 655 |
Option | Subtotal | Proportion |
Yes | 542 | 82.75% |
No | 113 | 17.25% |
This question is valid for the number of times | 655 |
- Although 88% of respondents believe that the purchase of RP helps to improve the sustainable use of resources, only 46.87% of the respondents who purchased RP in actual. Following this, 23.51% of respondents are unclear whether the product they purchased is RP. Accordingly, 27.94% of the respondents have not purchased RP, but said they would consider purchasing in the future. It shows that consumers have a higher preference for RP, but their mobility is not strong. But future development is more optimistic.
- Through surveys of satisfaction with RP, 54.05% of respondents expressed satisfaction with the quality and appearance of RP. Under the premise of no difference in quality between RP and NP, 53.28% of respondents prefer to purchase RP at the same price. However, 84.12% of respondents prefer to buy RP at a price lower than NP. Thus, 45.5% of respondents prefer to buy RP at a price higher than NP. Therefore, price and quality can effectively increase consumers’ preference for RP.
- It is optimistic that 90.23% of respondents believe that RP can increase the sustainable development of resources and are willing to recommend RP to friends and family. More than 80% of respondents are willing to participate in the recycling and remanufacturing industry to promote sustainable resource development
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Literature | Consumers Preference | E-Channel | Promotional Behavior under E-Channel | Closed Supply Chain | Supply Chain Network | ||||||
---|---|---|---|---|---|---|---|---|---|---|---|
NP, RP | Others | E-Channel | Double Channel | Remanufacturer Recycling and Remanufacturing | Recycling and Remanufacturing by Other Players | CLSCN | Supply Chain Network | Multi-Period | Variational Inequality | ||
Govindan et al. [1] | √ | ||||||||||
Ferrer and Swaminathan [2], Debo et al. [15], Matsumoto et al. [16], Zhao et al. [30], Zhu and Yu [31] and Xu and Wang [32] | √ | √ | |||||||||
Abbey et al. [3] and Zhao et al. [30] | √ | √ | |||||||||
Zhang and Ren [4] and Long et al. [6] | √ | ||||||||||
Dong et al. [8] and Nagurney et al. [22] | √ | √ | |||||||||
Haddadsisakht and Ryan [9], Wang et al. [23], Hammond and Beuleens [44], Allevi et al. [46] | √ | √ | |||||||||
Qiang [10] | √ | √ | √ | ||||||||
Nie et al. [11] | √ | ||||||||||
Hu et al. [12] | √ | ||||||||||
Nagurney et al. [13] | √ | √ | |||||||||
Kong et al. [14] | √ | √ | |||||||||
Sayedi et al. [19] | √ | √ | |||||||||
Anand and Aron [20], Li et al. [35], Li et al. [36], Jin et al. [36] and Zhou et al. [37] | √ | √ | |||||||||
Savadkoohi et al. [21] | √ | √ | √ | ||||||||
Du et al. [25], Wang et al. [26], Tong et al. [28] and Peng et al. [29] | √ | ||||||||||
Ji et al. [27] | √ | √ | |||||||||
Peng et al. [29] | √ | √ | |||||||||
Nagurney and Dutta [3] and Wu et al. [39] | √ | √ | |||||||||
Giri et al. [43] | √ | ||||||||||
Pedram et al. [45] | √ | ||||||||||
Zhalechian et al. [47] | √ | ||||||||||
Tao et al. [48] | √ | √ | √ | ||||||||
This paper | √ | √ | √ | √ | √ | √ | √ |
Type | Detailed Description |
---|---|
Production methods | Re: The RP is produced by EOL products and using the technology. M: The NP is produced by raw materials and using the technology. |
Production process | Re: Cleaning, disassembly, testing, parts classification, technology selection, remanufacturing, inspection, etc. M: Through the technical processing of raw materials produce NP. |
Product difference | The performance and quality of NP and RP are similar or identical. |
Enterprise characteristics | Re: The remanufacturer is engaged in a physical process and a chemical process. For the physical process, the nature of the RP’ remains unchanged. For the physical process, the remanufacturers are not engaged in the work of refurbishment and maintenance. EOL products are remanufactured by high-tech. M: Belonging to the chemical process, that is, through the technical processing of raw materials to produce new products. Product patent rights, original product pricing rights, primary market control, etc. |
Contribution | Contribution to environmental and sustainability: Re: Save the use of raw materials and improve the utilization of resources. Energy-saving reaches more than 60%, the material consumption is over 70%, and exhaust gas emissions are reduced by more than 80%. M: Less contribution to the environment and sustainability. Contribution to the economy: Re: The cost of RP is only 1/4 or even 1/3 of the cost of NP. M: Develop new products that were not available before, promoting economic development and improving people’s living standards. |
Industry size and distribution | Industry size and distribution: Re: At present, the global remanufacturing industry is over $140 billion, including engines, auto parts, construction machinery, electrical and electronic products, automobiles, railway equipment, medical equipment, clothing, etc. The largest remanufacturing industry in the world is the United States, followed by Japan, Germany, and China. The distribution of remanufacturing companies around the world, as shown in Figure 3. M: There are a large number of manufacturing companies around the world, and there are tens of millions of manufacturing companies registered each year globally. Among them, China 28.57%, the United States 17.89%, Japan 8.16%, Germany 6.05%. Industry companies: Re: There are a large number of remanufacturing companies in the world, and only 75,000 remanufactured companies are in the United States. The world’s largest remanufacturing company is CATERPILLAR, which has 19 plants and 160 production lines in North America, Europe, and the Asia Pacific. The Volvo Remanufacturing Center has eight remanufacturing plants in the world. Lister Petter Remanufacturing Company, ReMobile, Kodak, Xerox, etc. M: The number is huge, and there are tens of millions of manufacturing companies registered globally every year. |
Relationship | Competitive relationship: The function of the products and the consumer group are the same or similar. Cooperative relationship: The remanufacturers need to give the manufacturers a certain patent fee. The EOL products come from the original product produced by the manufacturer. For example, CATERPILLAR has a long-term strategic partnership with many manufacturing companies that produce hydraulic pumps, hydraulic pumps, fuel pumps, oil pumps, pumps and engine components, including CATERPILLAR (Shanghai) and China’s Liugong signed a long-term cooperation. |
Sign | Definition |
---|---|
Basic parameters in the E-CLSCN | |
m | A typical manufacturer, m = 1, 2, … M |
r | A typical remanufacturer, r = 1, 2, … R |
d | A typical demand market, d = 1, 2, … D |
t | A typical planning period, t = 1, 2, … T |
δ | The subsidy of collect EOL products per unit that the government provides r |
The consumers’ preference for NP at the t | |
The consumers’ preference for RP at the t | |
The utilization of raw materials into NP, | |
The utilization of EOL products into RP, | |
Transactions and production variables associated with various players in the network | |
The number of raw materials by the m at the t, all | |
The number of NP sold by the m to the d at the t, all | |
The number of RP sold by the r to the d at the t, all | |
The number of EOL products collected by r from d at the t, all | |
The available inventory of m at the beginning of the t, all | |
The available inventory of r at the beginning of the t, all | |
The retail price of the NP at the t | |
The retail price of the RP at the t | |
The collecting price of the EOL products that the r from the d at the t | |
Functions associated with various players in the network | |
The function of raw materials cost, which the m Purchase at the t | |
The cost of per unit NP’s AI-push at the t | |
The cost of per unit RP’s AI-push at the t | |
The function of the production cost of the m at the t | |
The function of remanufacturing cost of the r at the t | |
The function of delayed payment cost, which the m allows the consumers to delay payment for NP | |
The function of delayed payment cost, which the r allows the consumers to delay payment for RP | |
The inventory cost function of the m at the t | |
the inventory cost function of the r at the t | |
The transaction costs of m and d at the t | |
The transaction costs of r and d at the t | |
The function of patent cost, which the m received from the r at the t. | |
The demand function of d for NP at t, and it is randomly positively correlated with , and , and is randomly negatively correlated with . | |
The demand function of d for RP at t, and it is randomly positively correlated with, and , and is randomly negatively correlated with . | |
The negative utility function for d that sells r EOL products at t | |
The profits of i, i = m, r, s, d |
Cost | Function |
---|---|
The function of raw materials cost at the t | |
The function of the production cost of the m at the t | |
The function of remanufacturing cost of the r at the t | |
The function of delayed payment cost at the t | |
The inventory cost function of the player at the t | |
The transaction costs of m/r and d at the t | |
The function of patent cost at the t | |
The demand function of d for NP in the first period | |
The demand function of d for NP at t | |
The demand function of d for RP at t | |
The negative utility function for d thatsells r EOL products at t |
Symbol | Dynamic Change |
---|---|
Dynamic | Pm1 | Pm2 | |||||
v1 | v2 | v3 | v1 | v2 | v3 | ||
6385.2 | 6383.8 | 6381.6 | 6376.0 | 6374.9 | 6373.8 | ||
1384.5 | 1385.0 | 1386.4 | 1380.7 | 1381.5 | 1382.1 | ||
7769.7 | 7768.8 | 7768.0 | 7756.7 | 7756.4 | 7755.9 | ||
6384.2 | 6382.7 | 6380.4 | 6375.1 | 6372.7 | 6371.5 | ||
1381.1 | 1382.1 | 1383.9 | 1378.0 | 1378.6 | 1379.4 | ||
7765.3 | 7764.8 | 7764.3 | 7753.1 | 7751.3 | 7750.9 | ||
6379.4 | 6377.9 | 6376.3 | 6371.64 | 6370.1 | 6369.2 | ||
1380.9 | 1381.7 | 1382.5 | 1376.8 | 1377.4 | 1378.0 | ||
7760.3 | 7759.6 | 7758.8 | 7748.4 | 7747.5 | 7747.2 | ||
6376.2 | 6375.4 | 6373.8 | 6368.4 | 6367.0 | 6365.6 | ||
1383.2 | 1383.3 | 1384.1 | 1379.1 | 1380.1 | 1381.3 | ||
7759.4 | 7758.7 | 7757.9 | 7747.5 | 7747.1 | 7746.9 | ||
Dynamic | Pm3 | Pm4 | |||||
v1 | v2 | v3 | v1 | v2 | v3 | ||
6368.3 | 6365.9 | 6359.9 | 6359.3 | 6358.0 | 6356.7 | ||
1375.1 | 1377.0 | 1377.6 | 1372.3 | 1372.9 | 1373.4 | ||
7743.4 | 7742.9 | 7737.5 | 7731.6 | 7730.9 | 7730.1 | ||
6367.7 | 6364.4 | 6363.1 | 6358.4 | 6355.2 | 6355.1 | ||
1373.8 | 1374.2 | 1375.1 | 1368.4 | 1370.7 | 1369.1 | ||
7741.5 | 7738.6 | 7738.2 | 7726.8 | 7725.9 | 7724.2 | ||
6362.9 | 6361.6 | 6360.3 | 6354.1 | 6352.7 | 6351.3 | ||
1372.9 | 1373.1 | 1373.8 | 1367.2 | 1367.8 | 1368.6 | ||
7735.8 | 7734.7 | 7734.1 | 7721.3 | 7720.5 | 7719.9 | ||
6360.0 | 6358.3 | 6356.8 | 6350.1 | 6348.5 | 6347.1 | ||
1374.9 | 1375.9 | 1376.8 | 1370.4 | 1371.1 | 1371.7 | ||
7734.9 | 7734.2 | 7733.6 | 7720.2 | 7719.6 | 7718.8 |
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Duan, C.; Xiu, G.; Yao, F. Multi-Period E-Closed-Loop Supply Chain Network Considering Consumers’ Preference for Products and AI-Push. Sustainability 2019, 11, 4571. https://doi.org/10.3390/su11174571
Duan C, Xiu G, Yao F. Multi-Period E-Closed-Loop Supply Chain Network Considering Consumers’ Preference for Products and AI-Push. Sustainability. 2019; 11(17):4571. https://doi.org/10.3390/su11174571
Chicago/Turabian StyleDuan, Caiquan, Guoyi Xiu, and Fengmin Yao. 2019. "Multi-Period E-Closed-Loop Supply Chain Network Considering Consumers’ Preference for Products and AI-Push" Sustainability 11, no. 17: 4571. https://doi.org/10.3390/su11174571