Coordination of Store Brand Product’s Green Supply Chain Based on Negotiation

Abstract

The environmental input of a store brand product’s green supply chain plays an important role in improving the product brand image and expanding the product demand. According to the difference of the initial one-off environmental investment of the store brand product, it can be divided into three modes: direct OEM, retailer’s full participation and retailer’s partial participation. The research methods employed in this study include model establishment, numerical analysis and comparison under three entrustment modes based on retailers’ negotiation strength. In addition, sensitivity analysis was used to test the influence of parameter variations on the results. The research results show that: (i) the direct OEM mode is the best choice for retailers when the retailer is in a weak position, but it is not the best choice for the manufacturer. With the increase of the retailers’ negotiation strength, the profits of both sides will decline, causing the problem of double marginal profit decreasing; (ii) the retailer’s full participation mode is the best choice for the manufacturer when the retailer is in a strong position, but not the best choice for the retailer. It is not the best choice for both sides when the retailer is in a weak position; (iii) the greenness and total profit of the supply chain are no relative with the negotiation strength of the retailer under the partial participation mode, and the greenness and total profit of the supply chain are the same as the condition under the integrated control to achieve the best coordination effect.