Study on Manufacturing/Remanufacturing Production and Pricing Decisions under Different Remanufacturing Channel Structures
Under different remanufacturing channel structures,remanufactured products not only cannibalize the demand for new products,but also positively(or negatively)influence the perceived value of new products.In order to reveal two synergistic effects on the production and pricing decisions of the manufacturing/remanufacturing system,two closed-loop supply chain models with OEM-remanufactured products and IO-remanufactured products were constructed,respectively.The corresponding equilibrium production and pricing solutions were obtained in closed-form expressions.Moreover,the positive(or negative)effects of remanufactured products on the perceived value of the new product were analyzed.Finally,numerical experiments were provided to analyze the joint influences of both cannibalization effects and the positive(or negative)effects of remanufactured products on the perceived value of the new product.The results show that with OEM-remanufactured products,the joint influences reduce the demand for new products.The profits of the OEM and the retailer decline with the increasing of the negative effect.After the negative effect reaches a certain level,the cost advantage of remanufacturing is not enough to compensate for the profit loss from the falling demand for new products.Only new products will be produced.With IO-remanufactured products,the positive effect alleviates the cannibalization effects.The profits of the OEM,IO,and retailer increase with the positive effect.If the OEM ignores the positive effect,the negative influence of the cannibalization effects may be overestimated.When the positive and negative effects of remanufactured products on the perceived value of the new product reach certain levels,IO-remanufac-tured products may be more conducive to promoting the development of the remanufacturing system.
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