Optimal joint trade‐in rebate strategies in a retailer‐led supply chain

This study investigates the joint trade-in rebate strategies in a supply chain with independent manufacturers selling substitutable products via a dominant retailer. We model their interplay as a Stackelberg game and analyze their joint trade-in rebate decisions. We find that the differentiated trade-in rebate scheme is better for the retailer, and the manufacturers cooperating in making their trade-in rebate decisions can achieve win-win results in most cases. However, replacement consumers could benefit from the retailer's uniform trade-in rebate scheme and the manufacturers not cooperating in their trade-in decisions. The latter is always more beneficial to the environment.