Study On The Pricing Of The Remanufactured Products Based On Trade-in

With the deterioration of living environment, people pay more and more attention to environment performance. Environment-friendly products are gaining increasing favor among consumers, and some of them are even willing to spend more money on remanufactured products. EU, the USA, Japan and China have promoted legislation to force manufacturers to reclaim their waste products, which largely stimulates products remanufacturing. At the end of last century, some leading international corporations, such as IBM and Xerox, began to remanufacture products and achieved remarkable economic results, which further promote products remanufacturing.Products manufacturing is a hot research topic both home and abroad. Some classic essays and models have been generated. But as to the price-setting mechanism of remanufactured durable products and reclaiming management, they are all short of systemic study and attention. In 2008, in order to cope with the financial crisis which is caused by subprime crisis and maintain rapid economic growth, China government adopted the policy of expand subsidies on trade-in service.Based on this background, in Chapter two I intend to explore how product acquisition management influences durable products remanufacturing, regarding the former is the basis as well as the premise of the latter. Then in Chapter three I make further qualitative analysis on market structure of durable products, consumer preferences, the cost of new products and remanufacturing products, lifecycle of durable products, government policy and how closed-loop supply chain structure affects pricing mechanism. On the basis of quantitative analysis, I build a two-stage discrete demand-based model concerning the pricing of remanufactured durable products, analyzing what are the optimal decisions respectively for manufacturers and consumers, and find that utility distribution of heterogeneous consumers is an important factor that influences the equilibrium outcome of this game. Then I build a two-stage continuous demand-based game model concerning the pricing of remanufactured durable products, analyzing how the cost of new products and remanufactured products and depreciation factor affect pricing. In Chapter four, the paper builds a continuous-time and continuous demand-based model concerning the pricing of remanufactured durable products against the background that the government provides subsidies on products trade-in service. In the end, this paper comes up with three strategies for manufacturers to set price:uniform pricing, differential pricing depending on product using time and differential pricing independent from product using time. The study shows that the manufacturers can gain maximum profit by adopting the strategy of differential pricing depending on product using time, while the minimum by adopting the uniform pricing.