‘Closed-loop supply chain models with bundling strategy’

ABSTRACT

In recent decades, due to the resulting competitive situation between new and refurbished products, the bundling tactics of closed-loop supply chain (CLSCs) is closely related to the marketing strategies adopted by the competitive channels. Despite this practice, there is little understanding on how exactly bundling strategies impact CLSCs' profits under a competitive environment. Therefore, this study made a major contribution by incorporating both bundling (mixed bundling and pure bundling) and collection strategies under price competition, into a game-theoretic model of CLSCs, where re-furbished products are packaged with new products by the retailer in a bundle. To analyse the bundling effect, mathematical models are developed under direct and indirect collection processes, and numerical analysis is presented. Results of the proposed model show that the total supply chain profit is higher in mixed bundling compared to pure bundling. Furthermore, it is observed that the direct collection strategy generates maximum profit in mixed bundling, while the indirect collection strategy yields higher profit in pure bundling. The results also show that under lower refurbished product’s market size, a pure bundling strategy would be helpful to increase the profit of the manufacturer and the retailer.

KEYWORDS:

• Closed-loop supply chain
• bundling
• refurbishing
• competition
• pricing

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Sarat Kumar Jena

Dr. Sarat Kumar Jena is currently an Associate Professor in Operations Management at the Department of Operations management and decision science area, School of Xavier Institute of Management, Bhubaneswar, Xavier University. He has obtained Ph.D in closed-loop supply chain management, M.Tech in Industrial Engineering and Management, IIT Kharagpur, India. He has over 7 years of working experience in the industry, academia, and research. Currently Dr. Jena is an Editor of Vilakshan-XIMB Journal (Emerald Publisher). He has one experience of handling Journal as an editor and associated editor level. Dr. Jena is serving as a reviewer for more than 10 international peer reviewed journals like Decision Science, IJPE, EJOR, and Omega etc. He has conducted several training programs both nationally and internationally in the areas of supply chain management, operations management, managing experience for digital supply chain, structural equation modeling, and measurement scales design, among others. Dr. Jena has published his work in various reputable international journals such as International Journal of Production Economics, Resources, Conservation and Recycling,  Service Science (INFORMS), Sustainable Production and Consumption, Computers & Industrial Engineering, International Journal of Production Research. His research interests include value Sustainable supply chain, Circular economy research, Supply chain finance,  and Digital supply chain management. In 2018, he was selected as a researcher in the Future Talent Postdoc Career Days program at Techische Universität Darmstadt, Germany.