Are Online and Offline Bargaining Profitable for the Retailer, Manufacturer, and Customer in A Green Supply Chain Management?

Abstract

Online and offline bargaining play one of the most important roles for attracting customers, increasing sales, and overall profit in the green supply chain management. Nowadays, it has attracted the attention of both manufacturers and retailers after dealing with their contracts. In this paper, the manufacturer invests in green innovation to produce green products after receiving orders from retailers through a dual channel. The retailer sells products to customers through a bargaining policy in the dual channel, whereas there is a contract, namely, revenue-sharing between the retailer and manufacturer. The selling price and green innovation-dependent demand are considered. The problem is solved through the game policy. The numerical experiment shows that without offline bargaining, the retailer’s profit decreases to 5.41%, whereas the profit of the manufacturer and the whole supply chain decreases by 25.69% and 10.48%, respectively. If this business continues only in the offline channel, the profit decreases by 40.89%, 42.22%, and 41.45%, respectively. Without online bargaining, the retailer’s profit decreases to 3.99%, whereas the profit of the manufacturer and supply chain decreases by 18.91 % and 13.62 %, respectively.  From this numerical result, it is found that online and offline bargaining increase the sales and overall profit.