Abstract:

With the shortening of the product life cycle， the number of discarded electrical and electronic products （such as mobile phones， TV sets， etc.） has grown sharply， which has caused serious energy waste and environmental pollution. Hence， the research of closed-loop supply chain have been paid more attention by the academic circles. However， existed studies have not considered the heterogeneity between new products and reproducts， and the effect of consumer regret. In this paper， the change path of demand is depicted for refurbished innovative products when considering the purchasing regret of consumers based on the closed-loop supply chain differential game system. To deal with homogeneity between new product and remanufactured product， purchasing regret coefficient is introduced to Bass diffusion model， and then a modified Bass diffusion model is built to depict the change path of innovative products’ demand after entering the market. And based on this， a closed-loop supply chain system is considered is considered which is dominated by a manufacturer and followed by a retailer. In this system， the manufacturer recycles used products at a given ratio. Then a differential game model is built under the Stackelberg game taking the sales of product as the state variable. The optimal path of wholesale price， retail price and the maximum profit of supply chain members is obtained by using the differential game theory and the optimal control theory. By numerical examples， the optimal decisions in different market conditions are compared. The results show that： （1） The higher the consumer regret factor， the smaller the sales volume. When new products account for a large proportion of sales， more energy should be devoted to improve the satisfaction of new product users； Conversely， when remanufactured products account for a large proportion of sales， remanufactured sale should be paid more attention. （2） manufacturer’s optimal wholesale price is fixed over time horizon and will not be changed by purchasing regret of consumers. This is because the manufacturer is the leader of the supply chain. Fixed wholesale prices can reduce uncertainty for retailers. Then retailers can adjust the sales volume by adjusting the price； （3） The seller adjusts the price of the product according to the sales volume of each stage. During the whole process， retail price first rises then descends. （4） the higher regret coefficient the lower retail price and the profit of manufacturer and retailer. Hence， both manufacturer and retailer should try best to improve customer satisfaction. our research shows that both manufacturers and retailers should strive to improve consumers' satisfaction with their products.

Key words: bass diffusion model, closed-loop supply chain, differential game, consumers’ purchasing regret, refurbished innovative products