Remanufacturing: A model for products with physical and technological obsolescence

Abstract

For a successful remanufacturing, it is important to ensure in advance that a product is suitable for remanufacturing and that a remanufactured product will provide greater economic and environmental value than a brand-new product. This paper provides an approach to estimate the economic and environmental advantages of remanufacturing. Focusing on the fact that advantages are greatly influenced by the nature of a product, i.e., its design and lifetime characteristics, as well as the timing of remanufacturing, this paper proposes a model for assessing the time-varying advantages of remanufacturing. The model provides an objective, quantitative method to compare a remanufactured product with an equivalent brand-new version from three perspectives: unit production cost, environmental impact, and net profit. It also defines a set of conditions under which a remanufactured product will be more profitable than a brand-new product. The model is expected to help remanufacturers make informed and effective decisions concerning product design and remanufacturing strategies. To illustrate, the developed model is demonstrated with an example of a desktop computer.