Search Results (28)

Product innovation for remanufacturing, beginning at the development stage, has become an important strategic decision in third-party remanufacturing. This study investigates decision-making on product innovation for remanufacturing under two third-party remanufacturing modes and examines how original equipment manufacturers (OEMs) and remanufacturers respond. Results show that outsourcing remanufacturing consistently offers a wider profitability range for the OEM and increases the likelihood of the remanufacturer adopting a full remanufacturing strategy. Furthermore, a higher innovation level enhances OEM profits, particularly when the remanufacturing industry is mature or when the innovation investment efficiency is high. Otherwise, incremental innovation is more beneficial. Innovation also lowers entry barriers for remanufacturers. Finally, the authorization remanufacturing is initially more environmentally friendly, whereas the outsourcing mode becomes superior as the innovation level increases. Full article

Remanufacturing in reverse logistics can not only support sustainable development but also provide a tractable way to achieve carbon neutrality. This study evaluates whether an original equipment manufacturer (OEM) should remanufacture outsource or authorize this reverse channel activity in the presence of government subsidies. Additionally, the model considers the equilibrium acquisition quantities, collection rates, prices, and effects of government subsidy under three reverse channel options: centralizing remanufacturing, outsourcing remanufacturing, and authorization remanufacturing. The analysis indicates that (i) a centralized approach with manufacturing and remanufacturing operations under a fixed government subsidy is always in the interest of the supply chain; (ii) that for the profit-maximizing third-party remanufacturer (3PR), the differentials in variable collection costs drive the strategy choice, and that a higher fixed scaling parameter of the collection cost favors outsourcing; and (iii) when the government aspires to reduce environmental effects and subsidy payments, the OEM and government have different reverse channel choice preferences. Surprisingly, profitability and environmental goals align under a high consumer acceptance of the remanufactured product. This paper extends the understanding of the remanufacturing strategy of an OEM and provides new insights on which reverse channel is optimal. Full article

In the context of green economy, Closed-Loop Supply Chain (CLSC) competition is intensifying. This study aims to help companies operating in green supply chains determine optimal remanufacturing strategies when competing with other firms. We examine the decision-making problem of CLSCs in competitive environments facing multiple remanufacturing mode options. The research constructs a Prisoner’s dilemma model for dual CLSCs, where each chain has three strategic choices: independent remanufacturing, outsourced remanufacturing, and authorized remanufacturing. Employing Stackelberg game models, Nash equilibrium analysis, and numerical simulations, this study explores how remanufactured product unit saving costs affect remanufacturing mode decisions concerning competitive intensity and discount policies. The study then draws the following conclusions: (1) CLSCs prefer outsourced and authorized remanufacturing in competitive scenarios; (2) Remanufactured product discounting significantly influences CLSC remanufacturing decisions; (3) Competitors typically adopt conservative strategies by aligning decisions with rivals. These results provide practical guidance for CLSCs selecting remanufacturing approaches when facing substitute competition, contributing to more sustainable and competitive supply chain operations. Full article

Empirical studies suggest that investing in consumer education on green consumption not only naturally induces environmental sustainability but also yields various economic benefits for the original equipment manufacturers (OEMs). However, as far as we know, these studies overlook the potential cannibalization of new product sales. By developing a theoretical model that involves consumer education on green consumption when choosing between in-house or outsourcing remanufacturing, we find that if allowing the flexibility of remanufacturing outsourcing, consumer education on green consumption introduces opportunities for opportunistic behaviors that can compromise both profitability and environmental objectives. Specifically, when OEMs engage in remanufacturing, either in-house or through outsourcing, we observe that the incentive to invest in consumer education on green consumption is greater for in-house remanufacturing compared to outsourcing. This heightened incentive for consumer education enables OEMs to maintain higher profits under remanufacturing in-house, which results in a threat to environmental sustainability. Full article

In recent decades, more and more consumers are becoming concerned about the environment and increasingly tend to buy remanufactured products. However, despite the emergence of green consumerism, many original equipment manufacturers (OEMs) are unlikely to engage in remanufacturing themselves and instead prefer to contract it to third-party remanufacturers (TPRs). Although the literature has recently highlighted the difference between outsourcing and authorizing remanufacturing, it does not explore how green consumerism impacts the choice between these two remanufacturing modes. To fill this gap, in this study, we develop two theoretical models according to which the OEM can outsource or authorize its remanufacturing operations to a TPR to satisfy green consumers who prefer remanufactured products. By comparing optimal outcomes, such as quantities, profit, and environmental factors, our analysis shows that a substantial proportion of environmentally conscious consumers prefer the strategy of remanufacturing outsourcing, which provides a win–win–win strategy for the OEM, the TPR, and the environment; otherwise, the OEM chooses to authorize remanufacturing, which negatively affects the TPR and the environment. As such, we suggest that governments try to increase the proportion of the population that favors green consumerism or implement measures that encourage OEMs to adopt remanufacturing outsourcing. Full article

Global emphasis on sustainable development is widespread, with industries playing a pivotal role in advancing global sustainability within the business and retail sectors. Consumer awareness of environmental concerns, such as pollution, prompts a focus on product biodegradability and eco-friendliness. Consequently, customers are drawn to products with higher green credentials. This study delves into the effectiveness of green attributes in retail industries, exploring the optimization of profit through a variable production rate and variable unit production cost, considering the selling price and the demand dependent on the product’s green level. In the long run, production systems may shift to an “out-of-control” state, resulting in the random production of imperfect items that must be remanufactured to maintain the industry’s positive brand image. To mitigate the impact of defective items, the industry opts to partially outsource a percentage of items, preventing shortages. However, this complex retailing system generates a significant amount of carbon emissions. This study introduces investments aimed at reducing carbon emissions to address this issue. In contrast with the existing literature, a green-level-dependent unit raw material cost is considered here for variable unit production cost. Ultimately, this study seeks to maximize the overall system’s profit by optimizing the selling price, order quantity, production rate, green level, and carbon emission reduction investments. The classical optimization technique is utilized to obtain analytic optimum results for the decision variables and total profit. Special cases and sensitivity analyses illustrate the real-world applicability and impact of green levels. Numerical findings indicate that considering the product’s green-level-dependent demand and unit production rate is $22.44\%$ more beneficial than nongreen products, partial outsourcing provides a $1.28\%$ advantage, and flexibility in the production rate yields a $69.60\%$ benefit over traditional systems without green elements. Additionally, technological investments to reduce carbon emissions result in a notable reduction of up to $4.53\%$. Full article

Here, the authors focused on determining the increase in consumers’ preferences for sustainable products, including that of OEMs, who are responsible for the drop in new product sales. We also assessed the effects of remanufacturing by outsourcing to third-party remanufacturers. However, the outsourcing of remanufacturing not only enables the producer to offer a remanufactured product at the same time as manufacturing new units; it also provides OEMs with the flexibility required to peruse eco-design in manufacturing and/or remanufacturing. For instance, Gree and Midea have heavily invested in eco-design to reduce energy costs in manufacturing, while Xerox has adopted a modular design approach to divert materials away from landfills and towards remanufacturing. Following observations of real-world applications, the authors developed two theoretical models in which remanufacturing can be outsourced to an independent remanufacturer, endowing the OEM with the flexibility required to enact eco-design in manufacturing or remanufacturing. This analysis reveals that OEMs tend to put more effort into eco-design in manufacturing than in remanufacturing. Furthermore, such efforts in the name of eco-design may be beneficial for both the OEM and the third-party remanufacturer. As such, this paper encourages governments to provide more incentives that will encourage OEMs to invest in eco-design in manufacturing and establish a possible “win–win” scenario in terms of both environmental and economic performances. Full article

This paper examines remanufacturing decisions in the context of outsourcing, which have important implications for environmental and economic sustainability. Specifically, we model the competition between an experienced Original Equipment Manufacturer (OEM) and an emerging Independent Remanufacturer (IR). The OEM can decide the manufacturing quantities of a brand-new product, and the IR can collect the OEM’s used products and remanufacture them for resale. The information structure is asymmetric, as only the OEM knows the market size. We identify the equilibrium quantities of both firms, which are shown to be strongly influenced by the IR’s cost efficiency and the consumers’ willingness to pay for the IR’s products. Asymmetric information also plays an important role. Is it always better to hide information? Interestingly, the OEM makes the most profit when the IR has full information on the market size. We find that when the market size is high, the OEM’s and IR’s production and encroachment decisions are the same as when both parties have equal information. The OEM also does not benefit from hiding market information from the IR when the market size is low. Indeed, if the IR’s cost efficiency is moderate and the market size is low, the OEM’s profits are actually hurt by hiding market information. Here, the diminished profits from hiding market information arises from the OEM’s substantially reduced production quantity to prevent IR encroachment. The OEM’s production quantity is higher if the OEM shares market information and the IR encroaches on the market. Thus, by sharing information, the OEM’s benefit gained from increased production quantity outweighs the cost of losing its monopoly. Additionally, consumer surplus increases when the IR engages in remanufacturing, while social surplus increases only when either the OEM’s or IR’s product is strongly favored. Even if the IR does not engage in remanufacturing, the resulting OEM monopoly can still lead to a higher environmental impact under certain market conditions. This arises when the OEM lowers production quantities when the IR encroaches on the market, thereby improving the overall environmental impact. Therefore, policymakers seeking to improve environmental and economic sustainability by encouraging IRs must consider these complex competition dynamics and consumer preferences, as they indirectly influence OEMs’ production decisions. Full article

This paper examines the impact of the contrast/assimilation effect and network externality of remanufactured products on remanufacturing mode selection for original equipment manufacturers (OEMs) under government subsidy. We develop a two-period Stackelberg game model in a closed-loop supply chain (CLSC) composed of an OEM and a third-party remanufacturer (TPR) considering two remanufacturing modes: authorization remanufacturing mode and outsourcing remanufacturing mode. The results show the following: (1) The OEM prefers to select authorization when the contrast/assimilation effect and government subsidy level are both relatively low; otherwise, the OEM prefers outsourcing. The TPR always prefers the outsourcing mode. Therefore, a win–win situation between the OEM and the TPR could be achieved through OEM outsourcing remanufacturing when the government raises subsidy levels or the contrast/assimilation effect is relatively obvious. (2) The outsourcing mode is more beneficial in promoting the sales of remanufactured products and is more environmentally friendly, while the authorization mode is better in regards to consumer surplus and social welfare. (3) OEM, TPR and CLSC could benefit from network externality increasing. The stronger contrast effect (assimilation effect) is profitable to the OEM and CLSC (TPR), but hurts the TPR (OEM and CLSC). (4) Government subsidy can significantly reduce consumer spending on remanufactured products. CLSC members encroach government subsidies which are offered to consumers through pricing adjustments. The findings provide managerial implications for OEMs’ remanufacturing mode strategy in the context of the contrast/assimilation effect and network externality of remanufactured products under government subsidy. Full article

To solve the problem of global warming and resources crisis, we adopt two remanufacturing strategies, denoted ‘In-House Remanufacturing Strategy’ and ‘Outsourcing Remanufacturing Strategy,’ respectively, for recycling and reusing waste products. However, to study the optimal remanufacturing strategy of a closed-loop supply chain (CLSC) network under government regulations and the manufacturer’s design for the environment, we use variational inequality to construct a CLSC network equilibrium model based on these two strategies. By using a comparative analysis of the decision-makers’ profits, carbon emissions, and carbon taxes, we show how the decision-makers should choose the optimal remanufacturing strategies under different government regulations and the manufacturer’s levels of design for the environment. The findings of the study show that the manufacturer’s design for the environment is conducive to resource recovery and promotes the development of remanufacturing activities. When manufacturers’ levels of design for the environment are high, although manufacturers will adopt the outsourcing remanufacturing strategy to obtain high profits, they will lose environmental benefits. The findings also show that the new product handling fee policy in government regulations can promote energy conservation and emission reduction, and the reproduction subsidy policy can encourage product remanufacturing. Moreover, when the government’s subsidy for remanufactured products increases to a threshold, it will prompt manufacturers to adopt the outsourcing remanufacturing strategy; and the remanufacturing subsidy threshold is negatively correlated with the manufacturer’s levels of design for the environment. Full article

Government requirements for the management of waste electrical and electronic equipment (WEEE) by electronics manufacturers and importers has raised some difficulties in structuring the reverse chain of WEEE in Brazil, notably due to the territorial extension of the country. The need to implement circular economy practices (CE) in the reverse chain of WEEE has been acknowledged as a key requirement for sustaining the international competitiveness of Brazilian companies. In this context, this study sets up to evaluate the flows of the reverse chain of WEEE, aiming to promote CE as well as its actions for the recycling, reuse, remanufacturing, and reduction of WEEE in Brazil. The study identifies and characterizes key manufacturing decisions for developing waste management capabilities, including the need for waste management responsibilities for installing and operating the collection points and transporting waste to recyclers. Likewise, the study highlights the relevance of the adoption of strategies for selling recycled materials to the secondary market, along with reusing and reducing the use of virgin materials. Initially, the managerial strategy is based on recycling and remanufacturing actions due to short-term monetary revaluation, in addition to the immediate resolution of the complex problem. It should be noted that the decision to outsource WEEE management does not exempt the manufacturer from reusing and reducing material consumption, an important contribution that must be taken into account in organizational practice, beyond the immediate resolution of the complex problem. Full article

Sheet metal part manufacture is a precursor to various upstream assembly processes, including the manufacturing of mechanical and body parts of railcars, automobiles, ships, etc., in the transport manufacturing sector. The (re)manufacturing of railcars comprises a multi-tier manufacturing supply chain, mainly supported by local small and medium enterprises (SMEs), where siloed information leads to information disintegration between supplier and manufacturer. Technology spillovers in information technology (IT) and operational technology (OT) are disrupting traditional supply chains, leading to a sustainable digital economy, driven by new innovations and business models in manufacturing. This paper presents application of industrial DevOps by merging industry 4.0 technologies for collaborative and sustainable supply chains. A blockchain-based information system (IS) and a cloud manufacturing (CM) process system were integrated, for a supply chain management (SCM) system for the railcar manufacturer. A systems thinking methodology was used to identify the multi-hierarchical system, and a domain-driven design approach (DDD) was applied to develop the event-driven microservice architecture (MSA). The result is a blockchain-based cloud manufacturing as a service (BCMaaS) SCM system for outsourcing part production for boxed sheet metal parts. In conclusion, the BCMaaS system performs part provenance, traceability, and analytics in real time for improved quality control, inventory management, and audit reliability. Full article

Many governments have imposed methods such as a carbon tax that aim to even out the negative effects of carbon emissions. The taxes levied on different agents lead to different make–buy decisions for production structures and different environmental outcomes. Some original equipment manufacturers (OEMs) outsource remanufacturing to independent remanufacturers (IRs). Thus, a question arises: What are the implications of carbon taxes levied on different agents on remanufacturing outsourcing decisions? To answer this question, we developed two models: (1) acting as common brand owners, OEMs can be taxed for both new and remanufactured products, or (2) acting as different emitters for production and remanufacturing, OEMs are taxed for new products; however, all carbon taxes related to remanufacturing are levied on IRs. Our analysis reveals that, regarding economic performance, firms should undertake a carbon emission tax on their own initiative because this allows the taxpayer to choose more units for its preferred products and leaves its rivals at a huge disadvantage. Moreover, regarding environmental sustainability, carbon emission taxes indeed lead to mitigating the effects of carbon emissions per unit; however, environmental agencies should also pay attention to reducing the total carbon emissions by limiting the volume effects. Full article

Carbon emission reduction has been a consensus goal for most countries to achieve environmental sustainability. The use of carbon emission trading policies has been generally considered by the governments. Remanufacturing, as an effective way to reduce carbon emission, is incorporated together with the tool of carbon emission policy to construct a low-carbon supply chain in this paper. We analyze the carbon emission reduction and profit maximization problem among enterprises of original equipment manufacturers (OEMs) and their outsourcing remanufacturers, integrating the impact of the carbon emission constraint policy and the carbon market. Considering consumer preferences on low-carbon products and recycling rates of waste products, we construct a Stackelberg game model (dominated by the OEM) and analyze the impact of a carbon emission constraint policy on sales price, volume, carbon emission, and revenue of new and remanufactured products in the supply chain system. The results suggest that the upper bound set by the government on carbon emission for enterprises positively affects sales volume of new products and negatively affects sales prices of both products. Moreover, the discount rate of carbon emission constraint negatively affects sales volume of new products and positively affects sales prices of both products. Notably, the carbon emission constraint policy has impacts on the production decisions of both manufacturers on an economic scale. When the upper bound of carbon emission is equal to a certain threshold, the OEM could obtain the greatest revenue. The results provide a new perspective for the government to attain the goal of carbon emission reduction and not sacrifice economic growth. Managers in outsourcing remanufacturers and OEMs could also be implicated from our results to collaborate in allocating remanufacturing orders to achieve win-win opportunities between them. Full article

To facilitate the green transformation of enterprises and realize low-carbon development, governments have adopted the policies of carbon emission constraint and carbon trade to promote enterprises’ low-carbon production. Although the two policies aim to reduce carbon emissions, they have different effects on enterprises’ production. Meanwhile, the development of remanufacturing caters to the low-carbon economy. Therefore, this article establishes the game models between an original equipment manufacturer (OEM) and a remanufacturer under carbon-emission-constraint and carbon-trade policies, analyzing the production decisions of enterprises under different policies to compare the influence of the two policies on outsourcing remanufacturing. The main conclusions of the article are as follows: (1) Both carbon-emission-constraint and carbon-trade policies increase the unit retail price of remanufactured and new products, reducing the new products sales volume. However, the sales volume of remanufactured products only decreases if the discount rate is less than the rate of carbon emissions of the two products. (2) The upper limit of carbon emissions can affect the unit outsourcing cost. The unit cost of outsourcing under the carbon-emission-constraint policy is only higher when the upper limit of carbon emissions is less than a certain threshold, and the discount rate is larger than the proportion of carbon emissions for both products; otherwise, the unit outsourcing cost under the carbon-trade policy is higher. (3) Both policies lessen the total environmental implication. When the upper limit of carbon emissions is less than a particular threshold, the environmental effect of the two manufacturers under the carbon-emission-constraint policy is smaller; otherwise, the environmental impact is smaller under the carbon-trade policy. Full article