A Study On Tracking And Pricing Strategies In A Supply Chain With Product Recall

With the increasingly fierce competition among enterprises,companies have chosen the global supply chain and outsourcing strategy to retain its competitiveness.This has brought cost advantages to the enterprise,but it has also brought great challenges to the product recall,particularly in the food and pharmaceutical supply chains.Therefore,the research of the supply chain tracking strategy is particularly important.Thus far,it mainly includes two parts,namely the research of tracking and recall strategies.Firstly,based on the tracking mode and the different recall strategies,in a three-stage network supply chain with contamination and product recall,considering the recall location of polluted products and inventory of supply chain,it investigates the optimization of tracking strategies in terms of tracking mode and recall strategy when contamination is found at either the supplier or the manufacturer.Furthermore,we make decisions of the optimal tracking strategy of network supply chain based on the contrastive analysis of the recall costs.Research shows that:there is a threshold policy decision of tracking modes,when step tracking is faster than full tracking,step tracking mode is more optimal;In terms of tracking capability of the decision,improving tracking capability in the downstream of the supply chain have more advantages than that in the upstream of the supply chain.Thus based on the tracking capability and pricing strategy,using the traceable unit size at the manufacturer level to measure the tracking capability,we propose a nonconvex nonlinear programming to jointly optimize tracking capability and price considering the tracking cost and recall cost in a supply chain with endogenous pricing.Results show that,in both centralized and decentralized supply chain,there is a unique tracking capability and retailing/wholesale price with closed-form solutions to optimize the supply chain profit.When the cost ratio(unit tracking cost/unit recall cost)is sufficiently large and small,the optimal tracking strategy is barcode tracking and unit tracking,respectively.However,when the cost ratio is moderately large and small,with the increment of the quality inspection threshold,the optimal tracking capability moves from batch tracking to barcode tracking and unit tracking,respectively.Furthermore,we find that the strict tracking regulation policy is a more robust than the subsidy policy to improve the supply chain tracking capability.Finally,based on the tracking capability and recall strategy,considering the recall strategy at different levels,this paper studies the joint optimization of supplier's tracking capability and price.Research shows that:according to the size of the comprehensive cost ratio,suppliers tend to use suitable traceability to maximize their profits when recall at suppliers;and then suppliers often use a lower level of traceability to optimize their profits when recall at manufacturers.Therefore,this study provides management insights on deciding the tracking strategies in supply chain.