Decision Models for Closed-Loop Supply Chain Based on CVaR Criterion and ORP-RRP Contracts

Abstract

Abstract:

Closed-loop supply chain coordination with risk aversion via ORP-RRP (orders rebate and penalty-recycles rebate and penalty) contracts is investigated. A closed-loop supply chain model composed of a single riskneutral supplier and a single risk-averse retailer is proposed based on conditional value atrisk(CVaR) criterion and demand uncertainty. Decision behaviors of members in closed-loop supply chain are researched, and then the impacts of riskaversion coefficient β and the sensitivity coefficient τ on recycling price and optimal ordering quantities studied. The results show that the established model and the ORP-RRP contracts are effective and feasible, which could provide reference for decision making in supply chain management．

Key words: CVaR, ORPRRP contracts, closedloop supply chain, risk

HUO Liang′an, JIANG Jiehui . Decision Models for Closed-Loop Supply Chain Based on CVaR Criterion and ORP-RRP Contracts[J]. Industrial Engineering Journal .

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