Incentive strategies for an optimal recovery program in a closed loop supply chain
We consider a dynamic closed loop supply chain made up of one manufacturer and one retailer, with both players investing in a product recovery program to increase the rate of return of previously purchased products. End of use product returns have two impacts. First, they lead to a decrease in the production cost, as manufacturing with used parts is cheaper than using virgin materials. Second, returns boost sales through replacement items.
Eur. J. Oper. Res.