Balancing price and green quality in presence of consumer environmental awareness: a green supply chain coordination approach

Abstract

This study analyzes the green channel coordination problem in a two-echelon supply chain where demand is a function of the selling price and the product's green quality.The retailer decides on the selling price while the manufacturer regulates the green quality of the product. To initiate the channel coordination and to establish a win-win outcome for both parties, a hybrid of "greening cost sharing" and "revenue sharing" contract (HGRS) is developed. This study contributes to the literature by providing an analytical approach to address the channel coordination and pricing issues in a green supply chain under the consumer environmental awareness while the manufacturer has the ability of enhancing, with investments, the product's green quality. Our study reveals that: (a) the proposed HGRS contract is capable of achieving channel coordination while both supply chain members gain more profit than in decentralized decision making, (b) the new suggested contract enhances the product's green quality, reduces the selling price, and stimulates the market demand, and (c) HGRS contract results in more satisfied customers (by offering low prices) as well as more sustainable operations (by increasing greenness level) at the same time.

Research on Reward and Punishment Contract Model and Coordination of Green Supply Chain Based on Fairness Preference

“…(1) If g > g 0 , suppose the production is market demand, that is, q = (a − bp + γg), Simulate and assign the relevant parameters, q = 550, δ = 450, b = 10, γ = 18, C m = 5, C s = 15, θ = 1.5, w = 20, g* = 0.73, p* = 38.15 from ( 15) and (16). At this time, the overall profit of the green supply chain is the largest, with the maximum value of 3176.87.…”

“…The product sales price is determined by the retailer and the manufacturer determines the product green degree. A hybrid contract of green cost sharing and revenue sharing is proposed [16]. In the reverse green supply chain, Yuan constructed a dynamic game model to analyze the green manufacturer's mixed recycling channel strategy and found that the green remanufacturer assumed environmental responsibility, and the recycler showed a strong fairness concern for profits.…”

The Impact of Industry 4.0 on the Future of Green Supply Chain

“…We can analyze the available sources from multidisciplinary point of view. The green supply chain problems include a wide range of scientific problems, including inoovation management [14], price balancing [15], fuzzy optimization [14,[16][17][18], impact of manufacturing on environment [19], collection channel The Impact of Industry 4.0 on the Future of Green Supply Chain DOI: http://dx.doi.org/10.5772/intechopen.98366 design [20], cross-shareholding problems [21], big data and artificial intelligence applications [22], dual channel supply chain design [23,24], integrated optimization of green supply chain operations including routing and scheduling [25], social impact of greening [26], and green water transfer design [27]. These aspect are analyzed in different case studies [28][29][30].…”

Coordinating inventory sharing with retailer's return in the consignment contracts

“…It is investigated that the multi-hospital system is beneficial to reduce the medical supply chain risk (Zepeda et al 2016). Although the application of revenue-sharing contract in the consignment design has obtained some concentration in academia (Bart 2020;Heydari 2020), there still lacks the analytical work on the consignment contracts with inventory sharing and the consideration of retailers' return problem.…”