Revenue-and-Expense Sharing Contract of Closed-Loop Supply Chain with Two Markets

This paper focuses on the closed-loop supply chain coordination problems when the sale price affects the demand directly and the effort level of recycling affects the recycle amount. Firstly we establish the two-stage closed-loop supply chain model in the situation where, the retailers sell the same product to two independent markets and recycle the waste products by themselves. Then we design the revenue-and-expense sharing contract, i.e., the manufacturer simultaneously shares the sale revenue and part of recycling cost of retailers. This paper compares and analyses the optimal decision-making and profit of the participants in centralized decision-making and contract coordination of decision-making mode, and explores the condition of achieving perfect coordination of the whole closed-loop supply chain. Furthermore, we can obtain the arbitrary interest allocation forwards and reversely in the supply chain. Finally, numerical example demonstrates the validity of the conclusions of this paper.