Optimal remanufacturing strategies for original equipment manufacturers: partner and mode selection
Optimal remanufacturing strategies for original equipment manufacturers: partner and mode selection
This study examines a supply chain with three players which are a contract manufacturer (CM), an independent remanufacturer (IR) and an original equipment manufacturer (OEM). The OEM outsources the production process of new products to the CM and enters the remanufacturing market by cooperating with the remanufacturer which can either be the CM or IR through outsourcing or authorization remanufacturing modes. We investigate the OEM's remanufacturing partner choice when the remanufacturing mode is given, and the remanufacturing mode choice when the remanufacturer is selected. We consider profitability and environmental performance as the OEM's decision-making criteria. When the wholesale price of the new product is exogenously determined, we find that cooperating with the remanufacturer that has a lower variable cost is the dominant strategy given a specific remanufacturing mode. When the CM strategically determines the wholesale price of the new product, the OEM should never select the CM as the remanufacturing partner, and the IR is always a preferable remanufacturing partner for the OEM. In addition, both outsourcing and authorization modes are optimal when the CM is the remanufacturer. However, when the IR is the remanufacturer, the OEM should always choose the outsourcing mode.
Production outsourcing, channel choice, cost structure, remanufacturing partner
1985-2026
Zhou, Qin
22cc3c1b-50f4-41e0-9c3e-8cdf183a022e
Meng, Chao
30df20a9-21f1-42c5-921f-99fd5b5629ec
Yuen, Kum Fai
5acba8bd-2837-4913-8ec8-5b9b98cb04b9
19 June 2023
Zhou, Qin
22cc3c1b-50f4-41e0-9c3e-8cdf183a022e
Meng, Chao
30df20a9-21f1-42c5-921f-99fd5b5629ec
Yuen, Kum Fai
5acba8bd-2837-4913-8ec8-5b9b98cb04b9
Zhou, Qin, Meng, Chao and Yuen, Kum Fai
(2023)
Optimal remanufacturing strategies for original equipment manufacturers: partner and mode selection.
Total Quality Management & Business Excellence, 34 (15-16), .
(doi:10.1080/14783363.2023.2219608).
Abstract
This study examines a supply chain with three players which are a contract manufacturer (CM), an independent remanufacturer (IR) and an original equipment manufacturer (OEM). The OEM outsources the production process of new products to the CM and enters the remanufacturing market by cooperating with the remanufacturer which can either be the CM or IR through outsourcing or authorization remanufacturing modes. We investigate the OEM's remanufacturing partner choice when the remanufacturing mode is given, and the remanufacturing mode choice when the remanufacturer is selected. We consider profitability and environmental performance as the OEM's decision-making criteria. When the wholesale price of the new product is exogenously determined, we find that cooperating with the remanufacturer that has a lower variable cost is the dominant strategy given a specific remanufacturing mode. When the CM strategically determines the wholesale price of the new product, the OEM should never select the CM as the remanufacturing partner, and the IR is always a preferable remanufacturing partner for the OEM. In addition, both outsourcing and authorization modes are optimal when the CM is the remanufacturer. However, when the IR is the remanufacturer, the OEM should always choose the outsourcing mode.
Text
Optimal remanufacturing strategies for original equipment manufacturers partner and mode selection
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More information
Accepted/In Press date: 26 May 2023
e-pub ahead of print date: 10 June 2023
Published date: 19 June 2023
Additional Information:
Funding Information:
The authors declare no conflict of interest in this research.
Publisher Copyright:
© 2023 The Author(s). Published by Informa UK Limited, trading as Taylor & Francis Group.
Keywords:
Production outsourcing, channel choice, cost structure, remanufacturing partner
Identifiers
Local EPrints ID: 478912
URI: http://eprints.soton.ac.uk/id/eprint/478912
ISSN: 1478-3363
PURE UUID: 09e47360-362b-4ce8-8cb5-bb6e865ee8a3
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Date deposited: 13 Jul 2023 16:44
Last modified: 06 Jun 2024 02:16
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Author:
Qin Zhou
Author:
Chao Meng
Author:
Kum Fai Yuen
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