Abstract:Considering perishable products usually have little salvage,a return policy-marginal return policy is proposad.This policy reveals the manufacturer's different attitudes toward the amount of the returned products.By applying the marginal return policy,the decisions of the manufacturer (wholesale price and return price) and decisions of the retailer(sales price and order quantity) are analyzed.Under marginal return policy,both profits of the manufacturer and retailer increase,which lead the increase of system's profit directly.At the same time,numerical experiments show that,contrast to the usual return policy,the marginal return policy could reduce the manufacturer's risks caused by the demand uncertainty.