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To provide a method for manufacturers and retailers in choosing return policy in e-commerce environment, this paper builds a supply chain with one manufacturer and two retailers based on system dynamics which involves in manufacturing, purchasing, marketing and returning. By comparing the profits of the manufacturer and retailers respectively, the profitable return policy can be find out. It turns out that the manufacturer can get more profits if consumers return the goods to the retailer.

Study on Return Policy in E-Commerce Environment Based on System Dynamics