Abstract: To study supply chain decision problems with buyback and restocking strategies when customers are allowed to return goods, a supply chain model composed of a manufacturer, a retailer and customers is built. We analyze the impact of buyback and restocking strategies on the profit of all parties in the supply chain with the objective of maximizing profit under the condition that customer return behavior increases inventory risk. The optimal choices of upstream and downstream members in the supply chain with the two strategies are studied and ordering strategy preferences of different parties are obtained. Finally, a numerical example is given to verify the theoretical results.It shows that only when the return rate is higher than a threshold, the supply chain prefers the restocking strategy, otherwise it prefers the buyback strategy; given the return rate and buyback price, the retailer prefers the restocking strategy when the profit-sharing coefficient exceeds a threshold, otherwise it prefers the buyback strategy; to make the retailer and the manufacturer prefer the same ordering strategy, it is necessary to pay attention to the return rate and give an appropriate profit-sharing coefficient.

Key words: return of goods, restocking, buyback, supply chain, ordering strategy preference