Abstract: In a closed-loop supply chain system composed of a single manufacturer and a single growing retailer, aiming at the randomness of market demand and capital constraints of the growing retailer, and considering the bilateral risk preferences of the supply chain, four closed-loop supply chain operation modes are established based on the mean-standard deviation criterion. The effects of risk preference, financing interest rates and self-owned funds on the closed-loop supply chain operation modes are analyzed. Results show that the profits of both sides in the supply chain are positively correlated with their own risk preferences and negatively correlated with each other’s risk preferences, thus, the manufacturer is more willing to cooperate with the retailer with risk aversion, and vice versa; when self-owned funds are low, it is more advantageous for the retailer to choose non-compensatory deferred payment mode, while when self-owned funds are high, the retailer tends to choose bank lending mode; when the transfer payment quota meets certain conditions, the market development contract can achieve Pareto improvement in the supply chain, so as to help the growing retailer capture growth opportunities and achieve rapid development.

Key words: risk preference, closed loop supply chain, capital constraints, financing mode