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Strategy Analysis of Recycling and Remanufacturing by Remanufacturers in Closed-Loop Supply Chain

Author

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  • Xiaofeng Long

    (Business School, Hunan University, Changsha 410082, China
    Information Science and Engineering College, Hunan International Economics University, Changsha 410205, China)

  • Tong Shu

    (Business School, Hunan University, Changsha 410082, China)

  • Shou Chen

    (Business School, Hunan University, Changsha 410082, China)

  • Shouyang Wang

    (Academy of Mathematics and System Science, Chinese Academy of Sciences, Beijing 100190, China)

  • Kin Keung Lai

    (International Business School, Shaanxi Normal University, Xi’an 710062, China)

  • Yan Yang

    (Business School, Hunan University, Changsha 410082, China)

Abstract

The paper investigates interactions in a two-period closed-loop supply chain consisting of a single manufacturer and a single remanufacturer. In the context of recycling and remanufacturing by the remanufacturer, the manufacturer and remanufacturer choose different production strategies. By comparing the costs, profits and equilibrium quantity of supply chain members in decentralized and centralized models, we focus on the conditions under which the remanufacturer chooses to sell the remanufactured products and compete with the manufacturer. Different cooperative strategies can affect closed-loop supply chain decision-making. The article analyzes the impact of each cost and recycling rate on the productions and profits of the manufacturer and remanufacturer, and compares the total profits of members between two models. The sensitivity analysis of the models shows that the centralized model can be an effective way of achieving greater efficiency in terms of the overall supply chain. This study provides insights into the remanufacturing theory, which might guide remanufacturing operations and strategies.

Suggested Citation

  • Xiaofeng Long & Tong Shu & Shou Chen & Shouyang Wang & Kin Keung Lai & Yan Yang, 2017. "Strategy Analysis of Recycling and Remanufacturing by Remanufacturers in Closed-Loop Supply Chain," Sustainability, MDPI, vol. 9(10), pages 1-29, October.
    • Handle: RePEc:gam:jsusta:v:9:y:2017:i:10:p:1818-:d:114402
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    References listed on IDEAS

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