Orienting around circular strategies (Rs): How to reach the longest and highest ride on the Retained Value Hill?

Abstract

To comply with a circular economy (CE) and gain significant financial, environmental, and societal benefits, original equipment manufacturers (OEMs) tend to adopt circular strategies, also known as “Rs”. With a growing tendency to develop new Rs in CE frameworks, OEMs can become disoriented. While remanufacturing is often ranked low compared to other Rs, remanufacturing can still retain the highest product value (pull the used product value up to the top of the Retained Value Hill (see graphical abstract)).The aim of this paper is to align remanufacturing in comparison to other value-retaining processes (VRPs) in terms of the retained product value. To fulfill this aim, data was collected through a literature study and interviews with remanufacturers. The results show that although remanufacturing tends to demand more resources to retain a high product value, it outperforms other VRPs and delivers better output quality, assured with a longer warranty, neutral product identity, and extended (doubled or tripled) product use time. This paper enriches the research on remanufacturing, VRPs, and CE frameworks by showing that OEMs can ride the Retained Value Hill highest and longest only with remanufacturing.