Study On Traid-in And Remanufactured Durable Goods Based On Customer Segment

The conflict of economic development and environmental protection is irreconcilable in traditional development pattern. Facing with the ever-increasing environmental pressure, people are desperate to find a solution. Remanufacturing enables us to recover value from used products by replacing components or reprocessing used parts to bring the product to like-new condition, attracting the attention of the public.This dissertation aims to investigate the profitability potential of remanufacturing from market perspective. Remanufacturing is a production strategy, but under the condition of price-dependent demand, it works as a marketing strategy. Our research studies the manufacturers’ decision and customers’behavior and therefore reveals the profitability of remanufacturing. Realizing the benefit, enterprises would be self-motivated to update remanufacturing level, instead of being tortured by the severe government rules. This knowledge is crucial for the government leaders to make right economic policies as well. We concentrate our research on the remanufacturing policy with trade-in rebates, which is a common tactic of used products collection and new products promotion, and government incentive policies.The main contents of the dissertation are as follows:First, we study the optimal trade-in rebates policies offered by either manufacturer or government under monopoly scenarios. We probe the customer behavior and the production strategies.Second, we inquire into the optimal trade-in rebates and remanufacturing policy in monopolic markets. Green consumer’s preference differing from primary consumer’s preference, this thesis issued on optimal pricing for the remanufactured products in multi-market of different green segment size. Remanufacturable products are reusable returns from earlier sales. To take this into consideration, we assume a two-period monopolistic model. And we have reaped the following conclusions:First, we show that trade-in can be a price discrimination strategy to improve the profit of the manufacturer. The optimal product prices and trade-in discount rates are influenced by durability factor, market share, competitiveness and the degree of saturation of the industry. We expose the characteristics of the parameters that affect the effects of the policy.Second, when trade-in becomes a collection tool of material supply for remanufacturing, the pricing scheme for the new and remanufactured products portfolio is changed. These two strategies allow the manufacturer to increase profit via price discrimination when he is either the monopoly or faces competitor. However, the situation changes once it comes to the comprehensive strategy in spite of the provider of the trade-in policy. In addition, a thorough analysis of cannibalization discloses the profitability potential of remanufacturing, considering the replacement purchase by the holders.