Research On Return Model Of Online Shopping Under Regulation With False Failure Returns

Return problem of online shopping has been a focus for the study of e-commerce. Especially in recent years, countries have introduced new policies and regulations to manage the return problem. According to relevant industry survey data show that in the past few years return problem has become a hot spot in number one of Chinese e-commerce complaints. At the same time, based on the industry’s outlook, expect quite a long period of time in the future, the whole market scale of Chinese online shopping will achieve rapid expansion, and the corresponding return amount will also continue to increase. So it’s very necessary to research the return problem, both from social resources saving and operational optimization of the supply chain.In the study of this paper, we analyzed the current situation of the return problem, and elaborated the related theory, also summarized the existing research results. Through the utility function, we analyzed the cause and the influence factors also the conditions of false failure returns. Then we constructed a false failure returns model to research the decision making of consumer and retailer. In this model, the cost in product return process, the refund amount and the promotion price of the returned product in the secondary market are set in a more realistic and practically significant way. By contrast, we find that consumers’ expected utility can be improved if retailers accept false failure returns. With the product valuation by consumers and its variance increasing, the retail price will rise accordingly.Then we studied the existence time constraint conditions of false failure returns model. We found the retail price will be increased and the retailers’ profits will be reduced, when the retailer commitments return period become longer. when the secondary sales price is higher or refund amount is lower, the retailer’s maximum return rate will rise. This allows retailers to improve the service level by adjustment of the two prices in a certain extent.Based on the previous model, we investigate the influence of the return time on the values of the false failure returns. We find that in any case, the optimal return price for the retailers always equals the earning from processing the returned product. When the return’s value is lower, we found the traditional buy-back contract can’t coordinate the supply chain any more, and then we put forward a differentiated buy-back contract, with different refund to the unsold product and consumer returns, to coordinate the supply chain.As a complement, we have studied the waste product recycling problem. The existing studies have confirmed that the third-party logistics economies of scale in China. Then we use closed-loop supply chain dual-channel model to reveal the third-party economies of scale how to change the decision-making that made by manufactures, retailer and third-part. Lastly, we employ the two-part tariff contract to co-ordinate the entire supply chain and optimize the decision making process.