Pricing And Financing Strategy Of Dual-Channel Supply Chain Under The Cap-and-trade Regulation

With the prevalence of low-carbon economy,countries around the world have introduced low-carbon policies to reduce their carbon emissions.Thus,the company's operations and decisions face major changes.China's low-carbon policy is just put into trial so that enterprises still attach less importance to some decision-making processes about the carbon reduction,such as sales channel selection and financing source selection.They always lead to deviations in the pricing and financing decisions which reduce the overall benefit of the whole supply chain.Therefore,the pricing and financing decisions of dual-channel supply chain under low-carbon policies have become an important issue in supply chain management.Based on the dual-channel supply chain structure,this paper constructs the supply chain financing model under the cap-and-trade mechanism.In the model,both manufacturer and retailer involve carbon emissions and carbon trade.The manufacturer need to make decision about carbon reduction investment in addition to pricing decisions.The manufacturer may face a shortage of capital and he has to get finance from the retailer or the carbon fund for production.This paper explores pricing and carbon reduction decisions in the supply chain where the manufacturer,as the leader,has carbon reduction investment and face the capital constraint.It also explores the financing decisions of manufacturers on the basis of supply chain profits and carbon emissions.This paper aims to provide a theoretical basis to the enterprise's operational decision-making and the government's low-carbon policy-making.First of all,under the premise of sufficient capital for manufacturers,we discuss the optimal decision of the supply chain both in the absence of carbon reduction investment and in the existence of carbon reduction investment.And we compare the two situations to analyze the impact of carbon reduction investment on making decisions.At the same time,according to the character of the dual-channel structure,the impact of the sales proportion in different channels and carbon trading prices is also studied.We explain that when manufacturers make carbon reduction investments,the manufacturer's wholesale price and the retailer's retail price decrease,and when the carbon trading price exceeds a certain level,the carbon trading price affect the wholesale and retail price with the proportion of sales channels.The carbon reduction investment behavior of manufacturers will reduce the overall carbon emission of the supply chain and increase the profits of manufacturers.Secondly,under the premise of manufacturer's capital constraint,we still discuss noncarbon-reducing investment and carbon reduction investment in the optimal decision-making,in each case we explored the differences with different financing source for manufacturer.According to the profit condition and carbon emissions under different channels,we provide opinions on the financing strategy of manufacturers.The capital constraint allows manufacturers to increase the wholesale price of their products.The retailer should maintain the retail price when the manufacturer gets the retailer's advance payment.But when manufacturer obtain financing through the carbon fund's loan,the retailer has to increase the retail price.The manufacturers cannot increase the whole carbon emission and profits of the supply chain through the advance payment of retailers,but they will be reduced if the manufacturer get financing through carbon fund's loan.In the case of carbon reduction investments,the manufacturers need to pay more for emission reductions when he gets advance payment,but there will be more carbon emissions than financing through carbon loans.We also conclude that if the manufacturer has more initial capital or lower carbon trade price,he should choose to borrow money from carbon funds.On the other hand,manufacturers are encouraged to get financing from retailers to maximize his own benefits.Finally,we expand the model of capital-constrained and manufacturer's investment in carbon reduction.Assumed that after the investment,the product becomes a low-carbon product.The consumers' low-carbon preference will increase the market demand of the product.It shows that the manufacturer's optimal carbon reduction investment decision is the same as when the retailer pay in advance.However,when the manufacturer chooses to finance through the carbon fund's loan,the optimal emission reduction investment is less than the previous two situations;When the consumer's low-carbon preference is moderate,the retailer's best decision is to increase the retail price of the product,and when the consumer's low-carbon preference is too low or even too high,the retailer should lower the retail price.As the preference increases,the profits of manufacturers also increase.