# Co-Opetition Strategy for Remanufacturing the Closed-Loop Supply Chain Considering the Design for Remanufacturing

^{1}

^{2}

^{3}

^{*}

## Abstract

**:**

## 1. Introduction

## 2. Literature Review

#### 2.1. The Influence of DfRem on the Remanufacturing System

#### 2.2. Competition between Manufacturer and Remanufacturer

#### 2.3. Cooperation between the Manufacturer and Remanufacturer

## 3. Problem Description

## 4. Notation and Assumptions

**Assumption**

**1.**

**Assumption**

**2.**

**Assumption**

**3.**

**Assumption**

**4.**

**Assumption**

**5.**

## 5. Remanufacturing Game Model

#### 5.1. Model A: Competition Model with Patent Protection

**Proposition**

**1.**

**Certification**

**1.**

**Proposition**

**2.**

**Certification**

**2.**

**Proposition**

**2.**

#### 5.2. Model B: Competition Model without Patent Protection

**Proposition**

**3.**

#### 5.3. Model C: Cooperation Model

**Proposition**

**4.**

## 6. Comparative Analysis of Equilibrium Results

**Proposition**

**5.**

**Certification**

**5.**

**Proposition**

**6.**

**Certification**

**6.**

**Proposition**

**7.**

**Certification**

**7.**

## 7. Numerical Simulation

## 8. Conclusions

## Author Contributions

## Funding

## Data Availability Statement

## Conflicts of Interest

## References

- Diallo, C.; Venkatadri, U.; Khatab, A.; Bhakthavatchalam, S. State of the art review of quality, reliability and maintenance issues in closed-loop supply chains with remanufacturing. Int. J. Prod. Res.
**2017**, 55, 1277–1296. [Google Scholar] [CrossRef] - Su, J.; Li, C.; Zeng, Q.; Yang, J.; Zhang, J. A green closed-loop supply chain coordination mechanism based on third-party recycling. Sustainability
**2019**, 11, 5335. [Google Scholar] [CrossRef] [Green Version] - Jian, J.; Li, B.; Zhang, N.; Su, J. Decision-making and coordination of green closed-loop supply chain with fairness concern. J. Clean. Prod.
**2021**, 298, 126779. [Google Scholar] [CrossRef] - Wang, H.F.; Huang, Y.S. A two-stage robust programming approach to demand-driven disassembly planning for a closed-loop supply chain system. Int. J. Prod. Res.
**2013**, 51, 2414–2432. [Google Scholar] [CrossRef] - Singh, R. Determinants of Remanufacturing Adoption for Circular Economy: A Causal Relationship Evaluation Framework. Appl. Syst. Innov.
**2022**, 5, 62. [Google Scholar] - Zheng, X.X.; Li, D.F.; Liu, Z.; Jia, F.; Lev, B. Willingness-to-cede behaviour in sustainable supply chain coordination. Int. J. Prod. Econ.
**2021**, 240, 108207. [Google Scholar] [CrossRef] - Pazoki, M.; Zaccour, G. Dynamic strategic interactions between a municipality and a firm in the presence of an extended producer responsibility regulation. J. Clean. Prod.
**2021**, 292, 125966. [Google Scholar] [CrossRef] - Liu, Z.; Zheng, X.X.; Li, D.F.; Liao, C.N.; Sheu, J.B. A novel cooperative game-based method to coordinate a sustainable supply chain under psychological uncertainty in fairness concerns. Transp. Res. Part E Logist. Transp. Rev.
**2021**, 147, 102237. [Google Scholar] [CrossRef] - Anil Kumar, G.; Bahubalendruni, M.V.A.; Prasad, V.S.S.; Sankaranarayanasamy, K. A multi-layered disassembly sequence planning method to support decision making in de-manufacturing. Sādhanā
**2021**, 46, 1–16. [Google Scholar] [CrossRef] - Liu, Z.; Wan, M.D.; Zheng, X.X.; Lenny Koh, S.C. Fairness concerns and extended producer responsibility transmission in a circular supply chain. Ind. Mark. Manag.
**2022**, 102, 216–228. [Google Scholar] [CrossRef] - Debo, L.G.; Toktay, L.B.; Van Wassenhove, L.N. Market segmentation and product technology selection for remanufacturable products. Manag. Sci.
**2005**, 51, 1193–1205. [Google Scholar] [CrossRef] - Ferrer, G.; Swaminathan, J.M. Managing new and differentiated remanufactured products. Eur. J. Oper. Res.
**2010**, 203, 370–379. [Google Scholar] [CrossRef] [Green Version] - Huang, Y.; Wang, Z. Values of information sharing: A comparison of supplier-remanufacturing and manufacturer-remanufacturing scenarios. Transp. Res. Part E Logist. Transp. Rev.
**2017**, 106, 20–44. [Google Scholar] [CrossRef] - Duberg, J.V.; Johansson, G.; Sundin, E.; Kurilova-Palisaitiene, J. Prerequisite factors for original equipment manufacturer remanufacturing. J. Clean. Prod.
**2020**, 270, 122309. [Google Scholar] [CrossRef] - Zou, Z. Game Models of Interdependent Third-Party Remanufacturing; Dalian University of Technology: Dalian, China, 2016. [Google Scholar]
- Zhao, J.; Wang, C.; Xu, L. Remanufacturing decisions research based on third-party recycling under patent licensing. Comput. Integr. Manuf. Syst.
**2018**, 24, 2631–2642. [Google Scholar] - Kerr, W.; Ryan, C. Eco-efficiency gains from remanufacturing: A case study of photocopier remanufacturing at Fuji Xerox Australia. J. Clean. Prod.
**2001**, 9, 75–81. [Google Scholar] [CrossRef] - Deutsch, C.H. Second Time Around, And Around; Remanufacturing Is Gaining Ground in Corporate America; The New York Times: New York, NY, USA, 1998. [Google Scholar]
- Zhang, G.; Qu, X.; Dai, G.; Hu, J.; Wang, Y.; Sun, H. Multi-period closed-loop supply chain network equilibrium with design level for remanufacture ability. Chin. J. Manag. Sci.
**2018**, 26, 54–66. [Google Scholar] - Chen, S. Using Sociological Theories and Methods to Analyze the Solutions and Measures of Environmental Pollution Problems. J. Environ. Public Health
**2022**, 2022, 9904222. [Google Scholar] [CrossRef] - Ijomah, W.L.; McMahon, C.A.; Hammond, G.P.; Newman, S.T. Development of robust design-for-remanufacturing guidelines to further the aims of sustainable development. Int. J. Prod. Res.
**2007**, 45, 4513–4536. [Google Scholar] [CrossRef] - Magrab, E.B.; Gupta, S.K.; Mccluskey, F.P.; Sandborn, P. Integrated Product and Process Design and Development: The Product Realization Process, 2nd ed.; CRC Press: Bocaraton, FL, USA, 2009. [Google Scholar]
- Örsdemir, A.; Kemahlıoğlu-Ziya, E.; Parlaktürk, A.K. Competitive quality choice and remanufacturing. Prod. Oper. Manag.
**2014**, 23, 48–64. [Google Scholar] [CrossRef] - Wu, C.H. OEM product design in a price competition with remanufactured product. Omega
**2013**, 41, 287–298. [Google Scholar] [CrossRef] - Subramanian, R.; Ferguson, M.E.; Beril Toktay, L. Remanufacturing and the component commonality decision. Prod. Oper. Manag.
**2013**, 22, 36–53. [Google Scholar] [CrossRef] - Zhu, H.; Zhu, X.; Ding, L.; Guo, W. Decision and coordination analysis of extended warranty service in a remanufacturing closed-loop supply chain with dual price sensitivity under different channel power structures. RAIRO-Oper. Res.
**2022**, 56, 1149–1166. [Google Scholar] [CrossRef] - Xian, L.; Wang, X.; Qian, G.; Qin, Y. The incentives for remanufacturing based on product design and the effects of government intervention. Syst. Eng.-Theory Pract.
**2017**, 37, 1229–1242. [Google Scholar] - Xia, X. Game model between OEM and remanufacturer based on government subsidy and designing for remanufacturing. Syst. Eng.
**2017**, 35, 85–90. [Google Scholar] - Xia, X.; Zhu, Q. Study on game model of manufacture / remanufacture based on designing for remanufacturing. J. Syst. Eng.
**2018**, 33, 328–340. [Google Scholar] - Liu, Y.; Zhang, S. The research on the unified use of intellectual Proposition between the original manufacturers and the third-party manufacturers—Based on the View of the Orderly and Rapid Development of Remanufacturing Industry. Sci. Technol. Prog. Policy
**2018**, 35, 122–130. [Google Scholar] - Qiao, H.; Su, Q. The prices and quality of new and remanufactured products in a new market segment. Int. Trans. Oper. Res.
**2021**, 28, 872–903. [Google Scholar] [CrossRef] - Ferguson, M.E.; Toktay, L.B. The effect of competition on recovery strategies. Prod. Oper. Manag.
**2006**, 15, 351–368. [Google Scholar] [CrossRef] [Green Version] - Zhu, Q.; Zhou, S. Competitive Analysis of Auto-Part Manufacturer and Remanufacturer based on Government Price Subsidies. J. Syst. Manag.
**2014**, 23, 367–373. [Google Scholar] - Shi, L.; Sheng, Z.; Xu, F. The dynamics of competition in remanufacturing: A stability analysis. Econ. Model.
**2015**, 50, 245–253. [Google Scholar] [CrossRef] - Chen, Y.; Chen, F. On the Competition between Two Modes of Product Recovery: Remanufacturing and Refurbishing. Prod. Oper. Manag.
**2019**, 28, 2983–3001. [Google Scholar] [CrossRef] - Chai, Q.; Xiao, Z.; Zhou, G. Competitive strategies for original equipment manufacturers considering carbon cap and trade. Transp. Res. Part D Transp. Environ.
**2020**, 78, 102193. [Google Scholar] [CrossRef] - Xiong, Z.; Shen, C.; Peng, Z. Closed-loop supply chain coordination research with remanufacturing under patent protection. J. Manag. Sci. China
**2011**, 14, 76–85. [Google Scholar] - Yi, Y.; Yang, X. Remanufacturing closed-loop supply chain model under different patent licensing mode. Comput. Integr. Manuf. Syst.
**2014**, 20, 2305–2312. [Google Scholar] - Zhu, B.; Ma, Z.; Wu, N.; Leon, N. Influence of original manufacturer’s patent protection on technological innovation strategy of remanufacturing supply chain. Comput. Integr. Manuf. Syst.
**2018**, 24, 2329–2340. [Google Scholar] - Cao, J.; Zhao, Y.; Wu, S.; Zhang, X.; Zhou, G. Remanufacturing game with patent protection and government regulation. J. Manag. Sci. China
**2020**, 23, 1–23. [Google Scholar] - Zhao, X.; Meng, X.; Zhu, H. Game decision and coordination between OEM and remanufacturer in the authorization mode: Green innovation perspective. Manag. Rev.
**2020**, 32, 132–145. [Google Scholar] - Wang, K.; Xiong, Z.; Xiong, Y. The research on the model that the remanufacturer collaborates with the manufacturer in the same channel. Chin. J. Manag. Sci.
**2012**, 20, 145–151. [Google Scholar] - Wu, C.H.; Kao, Y.J. Cooperation regarding technology development in a closed-loop supply chain. Eur. J. Oper. Res.
**2018**, 267, 523–539. [Google Scholar] [CrossRef] - Sun, H.; Ye, J.; Hu, J.; Da, Q.; Wang, K. Research on the game strategies for the OEM and the remanufacturer under different decision structures. Chin. J. Manag. Sci.
**2017**, 25, 160–169. [Google Scholar] - Wang, N.; Zhang, Y. Game analysis of competition and cooperation between a manufacturer and a remanufacturer under carbon tax policy. J. Univ. Electron. Sci. Technol. China Soc. Sci. Ed.
**2021**, 23, 75–85. [Google Scholar] - Xia, X.; Zhu, Q. Study on the effect of design for remanufacturing on manufacturing/remanufacturing competition based on the outsourcing remanufacturing pattern. J. Manag. Sci. China
**2019**, 22, 97–112. [Google Scholar]

Symbol | Definition | Symbol | Definition |
---|---|---|---|

${p}_{n}^{ij}/{q}_{n}^{ij}$ | Price/quantity of the new product in period $j$ and Model $i$ | $\alpha $ | The Coefficient of DfRem |

${p}_{r}^{i}/{q}_{r}^{i}$ | Price/quantity of the remanufactured product in Mode $i$ | ${\beta}^{i}$ | The level of DfRem in Model $i$ |

${C}_{n}/{C}_{r}$ | Unit production cost of new/remanufactured products | ${\sigma}_{n}$ | The profit coefficient of DfRem to the unit new product |

$\varphi $ | Unit patent license fee | ${\sigma}_{r}$ | The profit coefficient of DfRem to the unit remanufactured product |

$\chi $ | Unit resale price of remanufactured products | ${\pi}_{m}^{ij}$ | M’s profit in period $j$ and Model $i$ |

$\mathrm{Z}$ | Market capacity | ${\pi}_{m}^{i}$ | M’s total profit in Model $i$ |

$\lambda $ | Consumers’ willingness to pay for remanufactured products | ${\pi}_{r}^{i}$ | R’s total profit in Model $i$ |

$\mu $ | Recycling cost coefficient of end-of-life products | ${\pi}^{i}$ | The total profit of CLSC in Model $i$ |

${\epsilon}^{i}$ | Recycling rate of end-of-life products in Model $i$ |

Model A | Model B | Model C | Model A | Model B | Model C | ||
---|---|---|---|---|---|---|---|

${\beta}^{i}$ | 15.14 | 11.21 | 15.50 | $\epsilon $ | 0.16 | 0.53 | 0.23 |

$\varphi $ | 17.34 | — | — | $\chi $ | — | — | 0.80 |

${p}_{n}^{i1}$ | 32.22 | 33.20 | 32.14 | ${\pi}_{m}^{i}$ | 574.83 | 458.05 | 582.42 |

${q}_{n}^{i1}$ | 18.78 | 17.80 | 18.88 | ${\pi}_{r}^{i}$ | 10.63 | 106.50 | 10.86 |

${p}_{n}^{i2}$ | 32.22 | 29.16 | 32.12 | ${\pi}_{m}^{i1}$ | 203.93 | 235.27 | 200.10 |

${p}_{n}^{i2}$ | 17.00 | 16.19 | 16.32 | ${\pi}_{m}^{i2}$ | 370.90 | 222.78 | 382.33 |

${p}_{r}^{i}$ | 18.62 | 15.23 | 18.25 | ${\pi}^{i}$ | 585.45 | 564.55 | 593.28 |

${q}_{r}^{i}$ | 2.96 | 9.42 | 4.25 |

Publisher’s Note: MDPI stays neutral with regard to jurisdictional claims in published maps and institutional affiliations. |

© 2022 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https://creativecommons.org/licenses/by/4.0/).

## Share and Cite

**MDPI and ACS Style**

Su, J.; Zhang, F.; Hu, H.; Jian, J.; Wang, D.
Co-Opetition Strategy for Remanufacturing the Closed-Loop Supply Chain Considering the Design for Remanufacturing. *Systems* **2022**, *10*, 237.
https://doi.org/10.3390/systems10060237

**AMA Style**

Su J, Zhang F, Hu H, Jian J, Wang D.
Co-Opetition Strategy for Remanufacturing the Closed-Loop Supply Chain Considering the Design for Remanufacturing. *Systems*. 2022; 10(6):237.
https://doi.org/10.3390/systems10060237

**Chicago/Turabian Style**

Su, Jiafu, Fengting Zhang, Hongyuan Hu, Jie Jian, and Dan Wang.
2022. "Co-Opetition Strategy for Remanufacturing the Closed-Loop Supply Chain Considering the Design for Remanufacturing" *Systems* 10, no. 6: 237.
https://doi.org/10.3390/systems10060237