Supply Chain Management of Marginal Cost-Intensive Green Products under Random Demand Model

Abstract

Our manuscript analyzes the performance of supply chain of marginal cost-intensive green products under random demand. This model contains two members: one manufacturer and one retailer. We study how different parameters influence performance of both centralized and decentralized channel. Our results suggest that: (1) overall profit in centralized channel is always higher comparing to decentralized channel; (2) centralized channel has higher production quantity and lower retail price; (3) the green-level is equal in these two channels; (4) in decentralized channel, the retailer will get more profits than the manufacturer.