Abstract: The coordinative strategy of closed-loop supply chain consisted of one manufacturer, one retailer, and one third party who is in charge of the recycle of used products is studied. The double marginal effect in closed-loop supply chain is analyzed, and then such supply chain coordinates with revenue-and-expense sharing contract. Furthermore, the conclusion shows that the coordination of the decentralized closed-loop supply chain could be broken off under the original revenue-and-expense sharing contract when the disturbance of the biggest market demand scale in the closed loop supply chain caused by unexpected accident occurs. Then, an improved revenue-and-expense sharing contract has been given, which is able to coordinate the closed loop supply chain and is suitable for coordinating closed loop supply chain before and after unexpected accident.

Key words: supply chain management, third party collecting closed loop supply chain, demand disturbance, revenue and expense sharing contract, coordination