Design for Remanufacturing: Manufacturer’s Motivation and Remanufacturer’s Responsibility Sharing

Abstract

This research focuses on two critical facets: the motivation driving manufacturers to engage in Design for Remanufacturing (DfR) and the decision-making process of the authorized remanufacturer regarding shared DfR responsibility. The study describes a scenario where the manufacturer produces new products and the authorised remanufacturer produces remanufactured products. The research employs three distinct models to analyse the complex dynamics between these two stakeholders. The findings indicate that: 1) the manufacturer's motivation for undertaking DfR responsibility is to optimise remanufacturing revenues by strategically increasing authorisation fees. 2) In scenarios where the unit remanufacturing cost-saving is limited, the authorized remanufacturer shares the DfR responsibility and selectively remanufactures a portion of used products. 3) Shared responsibility increases the remanufacturing ratio and profits for both stakeholders, effectively mitigating the free-rider dilemma. In addition, shared responsibility increases the authorisation fee without changing the proportion of DfR performance captured by the manufacturer.