Decision Analysis for Closed-Loop Supply Chains with Manufacturing Cost Disruptions

Abstract

This paper studies the decisions in closed-loop supply chain with manufacturing cost disruptions. We find that the optimal solutions in stable context are still robust when manufacturing cost disruptions are small. The optimal decisions are revised when manufacturing cost disruptions exceed the thresholds. Moreover, the decision maker in centralized context and manufacturer in decentralized context always prefer to change their decisions with disruptions, while the retailer in decentralized context only prefer to change when the manufacturing cost disruption is negative.