International Journal of Science, Technology and Society

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Research on Dynamic Closed-Loop Remanufacturing Decision-Making Model

Received: Jul. 18, 2018    Accepted:     Published: Jul. 19, 2018
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Abstract

This study proposes a dynamic multi-period pricing-ordering decision model for a closed-loop remanufacturing system with product substitution between the new and remanufactured goods. In particular, this study considers both new and remanufactured versions of a single product that are both subject to continuous decay and a multivariate demand function of price and time. The problem is formulated using a dynamic programming model. In analyzing the problem, it is assumed that the firm utilizes a periodic review inventory system in which the sales price can be arbitrarily increased or decreased in response to changes in the market demand over the product lifecycle. The proposal model takes the time-value of money into account. In solving the decision-making problem, it is assumed that the aim is to maximize the total discounted profit over a finite planning horizon. The numerical result shows that the total discounted profit is sensitive to demand parameters, but less sensitive to cost parameter and time-discounting factor parameter. In practice, the proposed pricing-ordering model may instruct frequent price-adjustments in the upward or downward direction in response to changes in the demand structure, with advances in information and Internet technology in a cost-effective fashion.

DOI 10.11648/j.ijsts.20180602.13
Published in International Journal of Science, Technology and Society ( Volume 6, Issue 2, March 2018 )
Page(s) 43-46
Creative Commons

This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.

Copyright

Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Closed-Loop Remanufacturing, Pricing, Net Present Value

References
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[3] Mitra S, Webster S. Competition in remanufacturing and the effects of government subsidies. International Journal of Production Economics 2008; 111 (2):287-298.
[4] Atasu A, Guide Jr VDR, Van Wassenhove LN. Product reuse economics in closed-loop supply chain research. Production and Operations Management 2008; 17 (5):483-496.
[5] Abbey JD, Guide JrA VDR. Typology of remanufacturing in closed-loop supply chains. International Journal of Production Research 2018; 56 (1-2):374-384.
[6] Kurilova-Palisaitiene J, Sundin E, Poksinska B. Remanufacturing challenges and possible lean improvements. Journal of Cleaner Production 2018; 172:3225-3236.
[7] Low JSC, Ng YT. Improving the economic performance of remanufacturing systems through flexible design strategies: a case study based on remanufacturing laptop computers for the cambodian market. Business Strategy and the Environment 2018; 27 (4):503-527.
[8] de Brito MP, Flapper SDP, Dekker R. Reverse logistics: a review of case studies. Report Series Research in Management ERS-2003-012-LIS, Erasmus University Rotterdam, the Netherlands. 2003.
[9] Ferrer G, Ketzenberg ME. Value of information in remanufacturing complex products. IIE Transactions 2004; 36 (3):265-277.
[10] Fleischmann M, Van Nunen JAEE, Gräve B. Integrating closed loop supply chains and spare parts management at IBM. Interfaces 2004; 33 (6):44-56.
[11] Chaowanapong J, Jongwanich J, Ijomah W. The determinants of remanufacturing practices in developing countries: evidence from Thai industries. Journal of Cleaner Production 2018; 170:369-378.
[12] Kalverkamp M, Raabe T. Automotive remanufacturing in the circular economy in Europe: marketing system challenges. Journal of Macromarketing 2018; 38 (1):112-130.
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  • APA Style

    Liang Tu Chen, Shih Wen Chien, Chun Chin Wei. (2018). Research on Dynamic Closed-Loop Remanufacturing Decision-Making Model. International Journal of Science, Technology and Society, 6(2), 43-46. https://doi.org/10.11648/j.ijsts.20180602.13

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    ACS Style

    Liang Tu Chen; Shih Wen Chien; Chun Chin Wei. Research on Dynamic Closed-Loop Remanufacturing Decision-Making Model. Int. J. Sci. Technol. Soc. 2018, 6(2), 43-46. doi: 10.11648/j.ijsts.20180602.13

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    AMA Style

    Liang Tu Chen, Shih Wen Chien, Chun Chin Wei. Research on Dynamic Closed-Loop Remanufacturing Decision-Making Model. Int J Sci Technol Soc. 2018;6(2):43-46. doi: 10.11648/j.ijsts.20180602.13

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  • @article{10.11648/j.ijsts.20180602.13,
      author = {Liang Tu Chen and Shih Wen Chien and Chun Chin Wei},
      title = {Research on Dynamic Closed-Loop Remanufacturing Decision-Making Model},
      journal = {International Journal of Science, Technology and Society},
      volume = {6},
      number = {2},
      pages = {43-46},
      doi = {10.11648/j.ijsts.20180602.13},
      url = {https://doi.org/10.11648/j.ijsts.20180602.13},
      eprint = {https://download.sciencepg.com/pdf/10.11648.j.ijsts.20180602.13},
      abstract = {This study proposes a dynamic multi-period pricing-ordering decision model for a closed-loop remanufacturing system with product substitution between the new and remanufactured goods. In particular, this study considers both new and remanufactured versions of a single product that are both subject to continuous decay and a multivariate demand function of price and time. The problem is formulated using a dynamic programming model. In analyzing the problem, it is assumed that the firm utilizes a periodic review inventory system in which the sales price can be arbitrarily increased or decreased in response to changes in the market demand over the product lifecycle. The proposal model takes the time-value of money into account. In solving the decision-making problem, it is assumed that the aim is to maximize the total discounted profit over a finite planning horizon. The numerical result shows that the total discounted profit is sensitive to demand parameters, but less sensitive to cost parameter and time-discounting factor parameter. In practice, the proposed pricing-ordering model may instruct frequent price-adjustments in the upward or downward direction in response to changes in the demand structure, with advances in information and Internet technology in a cost-effective fashion.},
     year = {2018}
    }
    

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  • TY  - JOUR
    T1  - Research on Dynamic Closed-Loop Remanufacturing Decision-Making Model
    AU  - Liang Tu Chen
    AU  - Shih Wen Chien
    AU  - Chun Chin Wei
    Y1  - 2018/07/19
    PY  - 2018
    N1  - https://doi.org/10.11648/j.ijsts.20180602.13
    DO  - 10.11648/j.ijsts.20180602.13
    T2  - International Journal of Science, Technology and Society
    JF  - International Journal of Science, Technology and Society
    JO  - International Journal of Science, Technology and Society
    SP  - 43
    EP  - 46
    PB  - Science Publishing Group
    SN  - 2330-7420
    UR  - https://doi.org/10.11648/j.ijsts.20180602.13
    AB  - This study proposes a dynamic multi-period pricing-ordering decision model for a closed-loop remanufacturing system with product substitution between the new and remanufactured goods. In particular, this study considers both new and remanufactured versions of a single product that are both subject to continuous decay and a multivariate demand function of price and time. The problem is formulated using a dynamic programming model. In analyzing the problem, it is assumed that the firm utilizes a periodic review inventory system in which the sales price can be arbitrarily increased or decreased in response to changes in the market demand over the product lifecycle. The proposal model takes the time-value of money into account. In solving the decision-making problem, it is assumed that the aim is to maximize the total discounted profit over a finite planning horizon. The numerical result shows that the total discounted profit is sensitive to demand parameters, but less sensitive to cost parameter and time-discounting factor parameter. In practice, the proposed pricing-ordering model may instruct frequent price-adjustments in the upward or downward direction in response to changes in the demand structure, with advances in information and Internet technology in a cost-effective fashion.
    VL  - 6
    IS  - 2
    ER  - 

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Author Information
  • Department of Commerce Automation and Management, National Pingtung University, Pingtung, Taiwan ROC

  • Department of Information Management, National Kaohsiung University of Science and Technology, Kaohsiung, Taiwan ROC

  • Department of Marketing and Distribution Management, Chien-Hsin University, Chungli, Taiwan ROC

  • Section