| With the increasing environmental awareness of consumers,many original equipment manufacturers(OEMs)remanufacture old products to improve their environmental reputation and add additional ways to generate income.Although remanufacturing has many benefits,it also brings some problems to firms' operation management.The most common is that whether remanufacturing is carried out by OEM itself or outsourced to an independent third-party remanufacturer(TPR),remanufactured products will encroach the market share of new products and cause cannibalization.In order to deal with this situation,many OEMs have innovated their products to maximize the quality distinction between innovative products and remanufactured products,so as to mitigate the encroachment caused by remanufactured products.The existing literature usually studies remanufacturing and product innovation separately without considering their impact on each other.However,in the context of remanufacturing,the relationship between remanufactured products and new products is no longer a simple competition relationship,but a competition and cooperation one.It is not very clear to what extent product innovation strategies can prevent cannibalization,especially when there are still green consumers who favor remanufactured products in the market.In addition,because the quantity of remanufacturing raw materials——old products is restricted by that of new products sold in the early stages,the managerial insights of cannibalization between high and low-end products in the existing literature cannot be simply extended to the remanufacturing environment.Therefore,to fill this gap,this dissertation studies OEM's product upgrade and interchangeable design strategies when remanufacturing is undertaken by OEM and TPR respectively,and investigates the impact of green consumers on product innovation strategies.That is,this dissertation includes the following three aspects:Firstly,OEM's product upgrade strategy in remanufacturing is studied.First,consider the two-stage decision-making model of OEM producing new products and remanufacturing old products.In addition,OEM can decide whether to invest in R&D and upgrade products.Through combining these two stages,the optimal decision of OEM is obtained by using the first-order condition.By using the backward induction,the optimal decisions of OEM and TPR are solved,and the results of the two models are compared to obtain managerial insights.Finally,in order to deepen the understanding,a numerical experiment is used to visualize the theoretical results.Different from the existing research,this dissertation combines product innovation with remanufacturing,and highlight how products upgrade strategies impact on the optimal strategy's choice under the remanufacturing operations that are undertaken by the OEMs and/or TPRs,respectively.Secondly,OEM's product upgrade strategy with green consumers in remanufacturing is studied.Firstly,the market is divided into green and general segments,and the demand function of new and remanufactured products with lower and higher remanufactured product prices is derived.Then a two-stage product upgrade model is constructed when remanufacturing is undertaken by OEM and TPR respectively.At this time,the OEM still needs to decide whether to upgrade the product in stage 1.Then the backward induction is used to solve the optimal decision of both sides,and a numerical experiment is used to visualize and analyze the sensitivity of the main results.Different from the existing research,this dissertation considers the impact of green consumers when combining product innovation and remanufacturing.Finally,when the innovation strategy is product interchangeable design,the optimal decision model of OEM in remanufacturing is studied.That is,in the first stage,the OEM's decision variable becomes the interchangeability of the product.In the second stage,the OEM still first announces its license fees for remanufacturing to TPR,and then both parties decide the quantity of new/remanufactured products at the same time.After solving the optimal decision under the two models by using the backward induction,the differences of optimal interchangeability,economic performance,environmental sustainability and social welfare are compared.Different from the existing research,this dissertation extends the cannibalization between high and low-end products with interchangeable design to the remanufacturing environment.Our results reveal that,from an economic performance perspective,it is more beneficial for the OEM to perform remanufacturing operations in-house;however,from an environmental sustainability perspective,such behavior is not always good for our environment.In particular,when the level of product upgrading is pronounced,the remanufacturing operations undertaken by the OEM are always detrimental to our environment,due to indulging in remanufacturing,as seen in Model O.In addition,we find that the proportion of green consumers has an important impact on product upgrading under the above two different remanufacturing situations.In particular,the difference of product upgrading motivation decreases with the increase of the proportion of green consumers;The difference of environmental impact increases with the increase of the proportion of green consumers.Finally,we show that,although the optimal level of interchangeability related to the product design in Model T is lower than that in Model O,the optimal quantity of remanufactured products in the latter scenario is always higher.The main contributions of this paper are as follows: Firstly,we extend the existing research tentacles of remanufacturing and product innovation,by discussing the product innovation and compatibility design issues of the original product manufacturer in these two situations,and discusses its specific impact on the competition and cooperation relationship of new/remanufactured products.Secondly,our research results provide a theoretical basis and decision-making reference for the original product manufacturer's product innovation and compatibility design decision. |
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