Closed-loop supply chain models for a high-tech product under alternative reverse channel and collection cost structures

In this paper we study closed-loop supply chain models for a high-tech product which is featured with a short life-cycle and volatile demand. We focus on the manufacturer׳s choice of three alternative reverse channel structures for collecting the used product from consumers for remanufacturing: (1) the manufacturer collects the used product directly; (2) the retailer collects the used product for the manufacturer; and (3) the manufacturer subcontracts the used product collection to a third-party firm. We characterize and compare the manufacturer׳s optimal production quantities and profits under the three alternative reverse channel structures. We also investigate the impacts of collection cost structures and implementations of product take-back laws on the manufacturer׳s choice of reverse channel structures.