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The Economics of remanufacturing under limited component durability and finite product life cycles

Author: Geyer, Roland ; Van Wassenhove, Luk N. ; Atasu, AtalayINSEAD Area: Technology and Operations ManagementIn: Management Science, vol. 53, no. 1, January 2007 Language: EnglishDescription: p. 88-100.Type of document: INSEAD ArticleNote: Please ask us for this itemAbstract: This paper models and quantifies the cost-saving potential of production systems that collect, remanufacture and remarket end-of-use products as perfect substitutes while facing the fundamental supply-loop constraints of limited component durability and finite product life cycles. Our results clearly demonstrate the need to carefully coordinate production cost structure, collection rate, product life cycle and component durability in order to create and/or maximize production cost savings from remanufacturing.
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INSEAD Article Europe Campus
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This paper models and quantifies the cost-saving potential of production systems that collect, remanufacture and remarket end-of-use products as perfect substitutes while facing the fundamental supply-loop constraints of limited component durability and finite product life cycles. Our results clearly demonstrate the need to carefully coordinate production cost structure, collection rate, product life cycle and component durability in order to create and/or maximize production cost savings from remanufacturing.

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