Refurbished Products Research Articles

Product refurbishment in an imperfect production inventory system under carbon regulations: An interval type-2 fuzzy environment

This study develops an imperfect production inventory model focusing on the proper handling of imperfect products and addressing carbon emissions in different stages of a production process. The proposed inventory system consists of three stages: production, screening, and refurbishing. The produced products undergo a screening process, with perfect quality items being delivered to the primary market, while imperfect quality products are routed through a refurbishing process, subsequently sold in the secondary market. It is observed that in the existing literature on refurbished products, all such types of products have been sold at the end of the business period, this means that there is no continuous demand of refurbished product at the remaining time points of the business period which does not support the practical situation in a real business system. In this regards, our main objective in this study is consideration of continuous demand of refurbished products along with perfect ones. Again, we incorporate interval type-2 fuzzy uncertainty in both markets’ demand to better reflect market fluctuations introducing a new defuzzification method. In this framework, we evaluate the effectiveness of two emission regulatory strategies: carbon tax and carbon cap and trade policies. The findings of this study offer valuable insights into various aspects. Notably, our analysis reveals that if the difference between the primary and secondary markets’ demands reduces to a large extent, a negative impact on the profit is observed. It is also shown that an increase in demand for refurbished products allows for a higher permissible rate of imperfections in production. Comparing the outcomes under two emission regulations, we find that the cap and trade policy is beneficial from both economic and environmental perspectives. Additionally, it becomes evident that the manufacturer should carefully consider the duration of each inventory stage, as it leads to a significant increase in overall emissions. Regarding the uncertain nature of the market, it is observed that demand volatility in the secondary market negatively affects the profit.

Enhancing sustainability in medical product supply chains: The role of remanufacturing and government subsidies

This study explores the impact of government subsidies on the production dynamics within the medical product supply chain, particularly focusing on the remanufacturing of medical goods. Amidst the backdrop of the COVID-19 pandemic, which has underscored the critical shortages in medical supplies, our research delves into the adoption of remanufacturing practices by medical product manufacturers as a strategic response to these shortages and environmental concerns. We investigate how government subsidies influence the production volumes of original manufacturers and remanufacturers and examine the competitive interplay between newly manufactured and remanufactured medical products. Through the development of three production game models—Scenario B (manufacturers produce both new and refurbished products), Scenario N (separate production of new and refurbished products by manufacturers and remanufacturers, respectively), and Scenario C (similar to Scenario N but includes a certification fee paid by remanufacturers to original manufacturers)—we analyze the strategies that could mitigate supply deficiencies during medical crises. Our findings indicate that the certification strategy (Scenario C) not only yields the highest total production of medical products but also offers a viable solution to enhance the sustainability of the entire medical production system by alleviating supply chain disruptions. Furthermore, we discuss the managerial implications of our results, emphasizing the potential of a joint remanufacturing strategy to stabilize the supply chain and foster environmental conservation. Lastly, we highlight our study's limitations and suggest future research directions, particularly concerning the variability in product quality and the reliance on government subsidies. This research contributes to a nuanced understanding of green remanufacturing within the pharmaceutical supply chain, offering insights for manufacturers, remanufacturers, and policymakers aiming for sustainable industry practices.

Designing manufacturer’s new product technology for a closed-loop supply chain with consumer context effect

As commonly believed, without consumer context effect, manufacturers facing horizontal competition from independent remanufacturers/refurbishers may reduce the remanufacturability of new products. Nevertheless, given the retailer’s refurbishment capability, we examine how a manufacturer’s product design, as measured by the technology level of the new product, is influenced by vertical competition from a retailer and consumer context effect. We consider three scenarios: (1) a vertical supply chain where the retailer lacks refurbishment capability, (2) a closed-loop supply chain involving a retailer with refurbishment capability, and (3) a closed-loop supply chain with consumer context effect which implies that retailer-refurbished products positively influence the perceived value of the manufacturer’s new products. We propose a game-theoretical model to determine the manufacturer’s optimal product technology level and pricing strategy, as well as the retailer’s pricing and refurbishment decisions. We show that, with the retailer’s refurbishment capability, although refurbished products of the retailer will cannibalize new products of the manufacturer, the manufacturer may design a low technology level instead of a high one. Our analysis also reveals that, under certain conditions, the profits of the manufacturer, retailer, and supply chain can increase with the emergence of the retailer’s refurbishment capability, compared to the scenario where the retailer lacks this capability. Furthermore, our findings suggest that in the presence of consumer context effect, even if refurbished products positively impact the perceived value of new products, the manufacturer may design a higher technology level to alleviate the vertical competition.

GENERATION, GENDER AND CIRCULAR CONSUMPTION: AN EXPLORATION OF THE BEHAVIOR OF URBAN INDIAN YOUTH

The global focus on circular economy transition is predominantly centred on manufacturing and business while the third crucial component of consumption is often ignored. Circular consumption provides the complementary looping actions through reducing consumption, reusing and purchasing recycled and refurbished products, adapting to new lifestyles, sharing product services, substituting to local products and so on. The present study explores the consumer behaviour of the urban Indian youth in light of the above and attempts to estimate their readiness for the circular economy transition. As a generation who will steer the journey to a sustainable future, their environmental attitude, purchase intention, social commitment etc. are important drivers of change. The study finds that the millennials and post-millennials of urban India form a homogenous cluster across age and gender groups and collectively reveal significant environmental awareness, pro-environmental behaviour, adaptation intention, willingness to pay and preparedness for change through circular consumption patterns.

A comparative analysis of channel strategies for refurbished products: The influence of blockchain, brand spillover on co‐opetitive supply chain

AbstractIndustry insiders and researchers have widely recognized refurbishment as an environmentally friendly activity that reduces raw material waste and energy consumption. Simultaneously, blockchain is increasingly used in the supply chain with its information transparency and traceability. The refurbished product market possesses substantial potential. Nevertheless, refurbished products carry an inherent risk of brand spillover. Within this framework, manufacturers must weigh broader considerations in selecting product distribution channels. In this study, we discuss three sales models for new and refurbished products in the secondary market, namely, Scenarios M (where the manufacturer sells new products to consumers through the retailer and sells refurbished products to consumers directly), R (where the manufacturer sells new products to consumers through the retailer, and the retailer produces and sells refurbished products alongside new products), and C (where the manufacturer sells new products to consumers, and the remanufacturer sells refurbished products to consumers through a retailer). Upon examining the equilibrium outcomes of each model, it is evident that a manufacturer's decision to produce refurbished products hinges on market demand. High demand for refurbished goods inclines manufacturers towards the M scenario, whereas insufficient demand leads to cessation of refurbishment activities. Conversely, retailers navigate between R and C scenarios based on market demand. The advent of blockchain technology shifts the strategic focus: the extent of brand spillover supersedes market demand as the pivotal factor influencing retailers' production strategies. Blockchain technology can increase manufacturers' profits. Interestingly, in Scenario C, blockchain does not always improve retailer profits.

A study on pricing and recycling strategies for retailers with consideration of selling new and refurbished products

A study on pricing and recycling strategies for retailers with consideration of selling new and refurbished products

Implications of Refurbishing Authorization Strategy and Distribution Channel Choice in a Closed-Loop Supply Chain

This study examines the optimal authorization strategy for an original equipment manufacturer (OEM), the optimal distribution channel choice for a platform, and their interactions. We developed four models based on the OEM’s two strategy choices — authorization and non-authorization strategies, and the platform having two distribution channels for refurbished products: reselling and agency selling channels. Our results indicate that the authorization strategy is optimal for the OEM when consumer’s preference for refurbished products is not sufficiently high. Unlike conventional research, an increase in the production cost of a new product leads to different choices for the OEM. Specifically, the OEM prefers a non-authorization strategy in the reselling channel and an authorization strategy in the agency selling channel. Moreover, under the OEM’s authorization strategy, the platform always adopts a reselling channel for refurbished products. However, under the OEM’s non-authorization strategy, the platform’s choice is determined by the commission fee and the production cost of the new product.

Blockchain-based refurbishment certification system for enhancing the circular economy

As the global population continues to grow, the enormous stress on our environment and resources is becoming impossible to ignore. A focus on producing and consuming as cheaply as possible has created an economy in which objects are briefly used and then discarded as waste, featuring a linear lifecycle that creates an enormous amount of waste. The alternative to the linear economy “take-make-waste” is called the “circular economy”. Under this paradigm, materials are recycled to build new products or components that are designed and built to promote their reuse and refurbishment. This assures the continuous (re-)exploitation of existing resources, reducing the extraction of new raw materials. However, customers often reject these reused or refurbished products under the suspicion that they do not meet the same usability, safety, or performance levels of new products. In this sense, trustworthy records of historical details of refurbished products could increase consumers’ confidence in products and components of the “circular economy”, prioritizing trustworthiness, reliability, and transparency. This work presents a new certification tool based on blockchain technology to guarantee trusted, accurate, transparent, and traceable lifecycle information of products and their components and to generate trustworthy certificates to probe refurbished product historical details. This tool aims to enhance refurbished product visibility by creating the basis for making the circular economy a reality in any domain.

Friend or foe? The impact of refurbished products in markets with network effects and standards competition

AbstractThe practice of offering refurbished products has become increasingly prevalent, yet limited research has studied the potential consequences of this emerging product strategy on the market performance of the corresponding brand‐new products. This study addresses this gap by examining the impact of refurbished products in markets characterized by network effects and standards competition, while considering the developmental stage of the technology standard employed by the products. Introducing refurbished products, primarily remanufactured from returned items, can pose challenges such as sales cannibalization and negative perceptions of product quality. We propose that introducing refurbished products can also generate positive effects, because the availability of refurbished products can be perceived as an indication of sizable prior sales of the brand‐new counterparts, alleviating consumers' concerns regarding an insufficient user base and limited availability of complementary products. Our empirical and experimental studies consistently demonstrate that the availability of refurbished products adversely affects the market value and purchase intention of the corresponding brand‐new products employing established technology standards. In contrast, the introduction of refurbished products does not have such a detrimental effect on products utilizing unestablished standards. Moreover, for a specific group of consumers, this green product strategy increases their purchase intention of brand‐new products. The managerial implications of the findings are discussed.

Agent-based model for assessment of multiple circular economy strategies: Quantifying product-service diffusion, circularity, and sustainability

Despite the increasing need for tools to support a circular economy, methods for assessing circularity and environmental consequences in a way that considers dynamic changes in heterogeneous consumer behavior are lacking. Here we propose an agent-based model for assessing seven explicitly-defined product-level circular economy strategies. The model endogenizes bounded rational consumer behavior and interactions related to product acquisition, obsolescence, repair, hibernation, and discharge. Simulation experiments with numerical examples were used to quantify the diffusion of product service systems (e.g., leasing of refurbished products and sharing/rental services), product circularity, and lifecycle greenhouse gas emissions over 30 years. As a result, synergies arising from promotion measures (e.g., pricing, advertisements, and service levels), bottlenecks (e.g., lack of collected products), and rebound effects (e.g., due to new production and transport) were identified. By employing “what-if” analyses, this model provides a means to identify effective interventions in the transition to a net-zero circular economy.

Understanding the factors affecting consumers’ behaviour when purchasing refurbished products: A chaordic perspective

This paper seeks to develop an integrated conceptual framework to explain the conditions that lead to consumers' behaviour when purchasing refurbished products. Innovative methodology was used, including “fuzzy-set qualitative comparative analysis” (FsQCA), to explore the factors affecting consumers’ behaviour in this regard. Data gathered from 472 consumers were used to test the suggested model. The results revealed that ethical constructs (i.e., “moral obligation, moral accountability, moral outrage”), threat and coping appraisal variables (i.e., perceived severity, perceived venerability), and value are key drivers of the purchase of refurbished products. The findings also revealed that moral obligation, moral outrage, perceived venerability, egoistic value, and attitude are necessary to stimulate purchase behaviour, while perceived severity, rewards, perceived cost, and altruistic value, although sufficient, are not in themselves necessary. This study offers useful implications for retailers, and re-manufacturers, which may help to enhance their marketing strategies and policies.

The decision-making of internet recycler considering Internet-of-Things application

PurposeThe primary aim of this study is to examine the decision-making process of a reverse supply chain within a cooperative-competitive environment, with a particular emphasis on the incorporation of Internet of Things (IoT) technology in the recycling process.Design/methodology/approachThe impact of IoT on recycling effectiveness, RF (refurbished) product demand and remanufacturing expenses is analyzed. The game-theoretic models are constructed to incorporate the co-competitive relationship between a IR (Internet Recycler) and a remanufacturer, with specific attention paid to the IR's application of IoT technology.FindingsThe results indicate that the use of IoT reduces the costs associated with remanufacturing, leading to an increase in the transfer price of pre-owned items procured from IRs. The efficacy of the reverse supply chain depends not only on its cost-saving capabilities but also on consumer preferences toward RF and remanufactured (RM) items.Practical implicationsIoT technology can benefit Internet recycling and remanufacturing by enhancing transparency, quality monitoring and automation of processes. It can also help reduce operating costs, improve customer engagement and incentivize cooperation between organizations.Originality/valueThis study examined the strategic decision-making processes in the context of cooperation and competition between IR and remanufacturers. In addition, this research makes a valuable contribution to the literature by elucidating the optimal conditions for the effective implementation of Internet of Things (IoT) technology in recycling operations.

A multi-objective integrated supplier selection-production-distribution model for re-furbished products: Towards a circular economy

Re-furbishing is enabling technology for business models based on a circular economy. A company produces new products in the first phase and uses returned products to offer re-manufactured or re-furbished products in the second phase creating sustainable development. This paper aims to present an integrated supplier selection-distribution model of refurbished products. The three objectives of the given model are minimizing cost, minimizing carbon footprints and maximizing revenue generated from the process. The model starts with allocating the orders of re-furbishing essentials to selected suppliers and then generating an optimal distribution pattern of an integrated mix of returned products and re-furbishing essentials.Goal Programming is used to generate the results. Results show that the presented model optimally allocates orders to different suppliers and creates distribution patterns between intermediaries maintaining the flow of the supply chain This study is helpful for decision-makers to find solutions to supplier selection, order allocation, and product distribution problems as an integrated approach using a single model. Regarding the literature available and to the best of author's knowledge, this is the first attempt to develop an integrated model selecting the suppliers at one hand while creating the distribution patterns on the other hand under the operational constraints satisfying the objectives of cost and carbon footprints minimization and profit maximization. The model is helpful in achieving economical and social benefits by minimizing the cost and maximizing the revenue as well as environmental sustainability by minimizing the carbon foot-prints.

Investigation of the Effect of Risk Perceptions of the Generation Z Consumers' Against Refurbished Products on Their Purchase Intention

Changes in the consumption culture of individuals, the economic problems experienced and the increase in environmental awareness cause significant increases in the sales of refurbished products, especially technological devices. While the growth of the refurbished product market contributes to consumers having these products at more economical prices, it also contributes to the reduction of the production costs of the enterprises and, from an environmental point of view, to the prevention of possible waste and damages that may arise during the production of new products. Therefore, it would not be wrong to argue that the sales of refurbished products will increase gradually and to predict that the refurbished product market will grow by diversifying. The present study investigates the effect of perceived risk dimensions of young consumers living in Turkey on their intention to purchase refurbished products. The reason why the Z generation was chosen in the study is to learn the buying habits of new or renewed products in technological products and to examine their attitudes towards refurbished products as a generation born and grown up in technology. Another reason for the selection of the Z generation in the research is that the Z generation, which constitutes an important part of society in Turkey, directs technological trends. It is thought that the findings of the research will make significant contributions to the marketing decisions of the companies producing technology for the Z generation, lawmakers and researchers. The research was carried out between January and March 2022 with 415 participants living in Istanbul, Turkey’s largest city, determined by the convenience sampling method. In this research, regression analysis was used to test the hypotheses. The research was carried out with 415 participants. As a result of the research, it was determined that social risk has a low positive and significant effect on the effect of perceived risk dimensions of Generation Z consumers on the purchase intention of the refurbished product, performance risk has a low negative significant effect, psychological risk has a good positive and significant effect, time risk has a low positive significant effect, and physical risk has a low negative and significant effect. These results show that the psychological risk perception of Z generation consumers is important in their renewed product preferences. For this reason, companies should be careful to offer products that meet the expectations of consumers for refurbished products and not disappoint Z generation consumers.

Competition and cooperation strategiesin the supply chains with remanufacturing and refurbishing

Refurbishing and remanufacturing differ in that the former allows for restored products of lower quality than new ones. Motivated by the competition between the refurbished product and remanufactured product, our article examines the strategic choices for remanufacturing between the original equipment manufacturer (OEM) and the upstream manufacturer/rival third party. We develop a no-remanufacturing competition model and two cooperative remanufacturing models to characterize the problems. By analyzing the equilibrium market structure of each model, we try to explore who (manufacturer or third party) is the best remanufacturing partner when refurbished products appear. The results show that the OEM is always willing to cooperate with the manufacturer or the third party, but such cooperation will not always possible. In both cooperative models, the third party tends to prioritize improving the quality of refurbished products. Additionally, the manufacturer-remanufacturing model consistently demonstrates a lower environmental impact. Our study provides some important managerial implications that can be utilized as strategic guidance for the remanufacturing industry.

Leasing, trade-in for new, or the mixed of both: an analysis of new recycling modes driven by industry 4.0 technologies

The circular economy has become a promising solution to electronic product reuse . The advanced technology of Industry 4.0 drives the recycling platform (RP) to carry out a variety of new business modes, which are important ways to realise a circular economy. In this article, we consider a monopolistic RP under trade-in for new mode, leasing mode, or their mixed mode, respectively. We develop a discrete-time game with infinite periods and use the Markov decision and Bellman equation to obtain the consumer’s perfect equilibria consumption strategies . By comparing different modes under RP’s profits, consumer surplus, and environment impact perspectives, we find that when the durability of leased refurbished product exceeds that of the resold refurbished ones, the mixed mode is better than the trade-in for new mode, which can achieve more platform profits, more consumer surplus, and less environment impact. By considering the three perspectives together, the mixed mode is not always better than the other two modes. The mixed mode is optimal only when the durability of leased refurbished one is relatively high. We also conduct extensive numerical research, show optimal service mode under three perspectives, and extend the effects of different qualities of recycled used products on optimal mode.

Environmentally-conscious behaviours in the circular economy. An analysis of consumers' green purchase intentions for refurbished smartphones

The management of waste from electrical and electronic equipment (WEEE) is a hot issue for both the scientific community and practitioners. Among the strategies that lead a system to circularity, that of reconditioning (or refurbishing) appears to be very suitable and profitable for WEEE management. According to it, this paper aims to contribute to the existing literature on consumer behavior and Circular Economy by studying what determines the green purchase intention of a refurbished smartphone. By applying a Discriminant Analysis it was found that psychological factors, such as green perceived value and environmental knowledge, are the most powerful predictors of green purchase intention of refurbished smartphones, while social and emotional ones, i.e. collectivism, subjective norms and environmental concern, do not influence it. Our results can be useful to both remanufacturers and retailers of refurbished products to identify more effective marketing strategies, as well as to policymakers to define specific measures and policies able to improve the environmental concern of the end consumers.

Consumer Preference for End-of-Life Scenarios and Recycled Products in Circular Economy

The way consumers dispose of end-of-life products (EoL products) and their acceptance of recycled products largely determine the final direction of resource flow. Therefore, clarifying consumers’ preferences for end-of-life scenarios (EoL scenarios) and recycled products and guiding consumers to participate in a circular economy is of great significance for enterprises and society to transition to a circular economy. However, as far as the existing research is concerned, there is a lack of comparison and summary of consumer preferences based on multi-category EoL products and recycled products. Therefore, this study took four categories of common consumer durables as the object to study consumers’ preferences for EoL solutions and recycled products and, based on the survey results, user segmentation in the market and consumer type segmentation in the CE were performed. The research results show that users generally support product reuse, and they generally have the highest acceptance of second-hand products and the lowest acceptance of refurbished products; meanwhile, consumers’ acceptance of recycled products varies by product type; according to the differences in preferences, consumers are divided into groups with different consumption characteristics; based on the differences in support for product recycling and recycled products, consumers are divided into the high perception group, the general perception group, and the low perception group in CE. The results of this study can provide reference for related research on sustainable waste management and sustainable consumption.

An economic production quantity model with refurbishment policy in dual-channel logistics

This work considers a dual logistics model with production and refurbishment simultaneously where the manufacturer accumulates all the return items in return inventory and sends it for refurbishment. The novelty of this work is in utilizing the strategy “buying green” and defining the demand function as dependent on selling price and environmental parameters. This study also examines whether the manufacturer works better as an original equipment manufacturer (forward logistics), as a manufacturer–refurbisher or as an independent refurbisher (reverse logistics) and analyses their effect on environment through carbon emission. Most of the reverse logistics model considers production inventory and refurbished/remanufactured inventory consecutively which is not realistic at all. The new item inventory is much more higher than the refurbished inventory because of the low acceptance rate of refurbished product. So, in this model, the return time of product is random. The aim of this work is to optimize the return time and how much return quantity can be accepted for a single time planning horizon. The findings of this work reveal that the total average cost is minimized with reverse logistics, and from the environmental perspective also, the models with reverse logistics are better than the forward logistics path only. Further, we have investigated the sensitivity analysis and shows that with high quality of production process, we can minimize the carbon emission up to a certain level and refurbishment is good only when refurbishment cost is smaller than the production cost. Finally, we carry out the graphical illustrations to justify our models.

Revenue management in a refurbishing duopoly with cannibalization

AbstractRefurbishing has promising economic potential, yet firms remain wary of its potential cannibalization effect on new product sales. Firms need to make strategic choices in competitive settings, involving varying brand strengths and collection constraints. The current study provides an empirical characterization of consumer behavior in such complex settings, which in turn informs an analytical model of optimal pricing policies. The results show that cannibalization (or switching) in a competitive environment has a linear relationship with price discounts, unlike the inverted U‐shaped relationship observed in monopolistic settings. The experimental results also highlight the relevance of cross‐cannibalization, especially for weaker firms (with low brand value) that compete with stronger firms to sell refurbished products. Our subsequent analytical results reveal how both competitors should adjust their refurbished product prices when internal and cross‐cannibalization coefficients change. Weaker firms should focus on surpassing stronger competitors in terms of collection and refurbishing efforts, which implies a predominant focus on operations. Finally, we show that refurbished product prices are a function of, and profits are concave in relation to, the number of core products collected by firms.