Abstract: In recent years, under the double pressure of resource shortages and environmental pollution, countries launched a series of environmental regulations. It forced companies to carry out the recycling of waste products and remanufacturing in order to strengthen eco-environmental protections and put our development in harmony with the natural ecological system. So the closed-loop supply chain was put forward, because it can realize ecological benefits and economic benefits at the same time. Although the subject of the closed-loop supply chain recycling channel choiceboasts of an extensive literature, these documents rarely consider the cost factor.In this paper, weassume enterprise of this supply chain remanufacture ability is insufficient, which would need government subsidies to incentive for remanufacturing. Considering the management cost in the process of recycling and remanufacturing cost, a closed loop supply chain model of a manufacturer and a retailer and consumers is constructed.Under the direct recycling channel, manufacturer set up a recycling station to collect waste products from consumers and unsalable products in the life cycle from retailer. And then turn the waste into recycled product for the next sales season to sell. In this mode, manufacturers are responsible for the cost of management and recycling, the process does not involve retailer.Under the indirect recycling channel, retailer takes charge of collecting waste products from consumers, and covers its management cost. Meanwhile manufacturer made a contract with retailer to encourage retailer to recycle products that retailer can resell unsalable products in the life cycle to manufacturer at higher price than the recycling price.By the numerical simulation analysis, we discussed the influence of order quantity、order price and the income of members in supply chain with the changing of recycling and selling price under these two recycling channels. The conclusion is as follows.(1) In terms of the manufacturer, the income mainly affected by the recycling price and is better t in the direct recycling channel at first. But selecting direct recycling mode is the optimal choice with the increasing of recycling price.(2) In terms of the retailer, selecting direct recycling mode will be dominant when these two prices remain at low levels. But the situation will be on the contrary as these two prices increasingsimultaneously. And the income under directly recovery mode mainly affected by the recycling price, under indirectly recovery mode it mostly affected by the selling price.This paper toke some key cost factors into consideration to make the study more adapted to the realistic environment. Besides research conclusions about recycling channel choice of closed-loop supply chain provide the certain reference value for evolutionary game theory of choosing recycling channels.

Key words: closed-loop supply chain, manufacturer, retailer, recycling models