Product-design and pricing strategies with remanufacturing |
| |
Authors: | Cheng-Han Wu |
| |
Affiliation: | Department of Industrial Engineering and Management, National Yunlin University of Science and Technology, Yunlin 64002, Taiwan, ROC |
| |
Abstract: | In this paper, we consider a supply chain that consists of an original equipment manufacturer (OEM) producing new products and a remanufacturer recovering the used items. The OEM often faces a strategic dilemma when determining the degree of disassemblability of its product design, as high disassemblability decreases the OEM’s production costs as well as the remanufacturer’s recovery costs. However, high disassemblability may be harmful to the OEM in a market in which the remanufacturer is encouraged to intensify price competition with the OEM because design for high disassemblability leads to larger cost savings in remanufacturing. We first formulate a two-period model to investigate the OEM’s product-design strategy and the remanufacturer’s pricing strategy in an extensive-form game, in which the equilibrium decisions of the resulting scenarios are derived. Next, we show the thresholds that determine whether remanufacturing is constrained by collection, the thresholds for the remanufacturer’s choice of a profitable pricing strategy, and the thresholds for determining the OEM’s product-design strategy. Finally, we expand the model for a multiple-period problem to show that the main insights obtained from the two-period model can be applied. |
| |
Keywords: | Supply chain management Product design Pricing Remanufacturing Game theory |
本文献已被 ScienceDirect 等数据库收录! |
|