Industrial Engineering Journal ›› 2024, Vol. 27 ›› Issue (3): 130-137,158.doi: 10.3969/j.issn.1007-7375.230080

• Sustainable Operation and Supply Chain Management • Previous Articles     Next Articles

A Study on Recycler Production Modes Considering Brand Advantages: Remanufacturing or Refurbishing

GUO Qiang, ZHANG Congcong, NIE Jiajia   

  1. School of Economics and Management, Southwest Jiaotong University, Chengdu 610031, China
  • Received:2023-04-13 Published:2024-07-12

Abstract: This paper investigates the influence mechanism of brand advantages on the choice of production modes for recyclers. Based on a tripartite game model, the decision conditions and benefit distribution results of recyclers choosing between remanufacturing and refurbishing with different brand advantages are analyzed using methods such as KKT conditions. Results indicate that with a low brand advantage, the choice of production modes for recyclers depends on recycling cost: low recycling cost leads to full refurbishment as the optimal strategy for recyclers, but it harms the interests of brand manufacturers and brand retailers; moderate recycling cost results in partial refurbishment for recyclers, where brand retailers benefit, but brand manufacturers are impacted; high recycling cost reduces the refurbishment threat of recyclers, and both brand manufacturers and brand retailers accept this outcome by default. With a high brand advantage, recyclers and brand manufacturers are motivated to reach a remanufacturing agreement, achieving a win-win situation for both parties, while brand retailers oppose this agreement strongly. Moreover, cooperative remanufacturing mode may not necessarily lead to high consumer surplus. In certain circumstances, consumer surplus in the refurbishment competition mode may exceed that in the cooperative remanufacturing mode.

Key words: closed-loop supply chain, brand advantages, remanufacturing, refurbishing

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