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Importance of closed-loop supply chain relationships for product remanufacturing


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  • Östlin, Johan
  • Sundin, Erik
  • Björkman, Mats
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    Remanufacturing is an industrial process where used products are restored (remanufactured) to useful life. In comparison to manufacturing, remanufacturing has some general characteristics that complicate the supply chain and production system. For example, a company must collect the used products from the customers, and thus the timing and quality of the used products are usually unknown. Remanufacturing companies are dependent on customers to return used products (cores). In this paper, seven different types of closed-loop relationships for gathering cores for remanufacturing have been identified. The relationships identified are ownership-based, service-contract, direct-order, deposit-based, credit-based, buy-back and voluntary-based relationships. Building theory around these different types of relationships, several disadvantages and advantages are described in the paper. By exploring these relationships, a better understanding can be gained about the management of the closed-loop supply chain and remanufacturing.

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    Bibliographic Info

    Article provided by Elsevier in its journal International Journal of Production Economics.

    Volume (Year): 115 (2008)
    Issue (Month): 2 (October)
    Pages: 336-348

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    Handle: RePEc:eee:proeco:v:115:y:2008:i:2:p:336-348

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    Keywords: Product recovery Reverse logistics Relationship marketing;


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    1. Severin Borenstein & Jeffrey MacKie-Mason & Janet Netz, 1996. "Exercising Market Power in Proprietary Aftermarkets," Working Papers _002, University of California at Berkeley, Haas School of Business.
    2. Kara, S. & Rugrungruang, F. & Kaebernick, H., 2007. "Simulation modelling of reverse logistics networks," International Journal of Production Economics, Elsevier, vol. 106(1), pages 61-69, March.
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    Cited by:
    1. Ghosh, Debabrata & Shah, Janat, 2012. "A comparative analysis of greening policies across supply chain structures," International Journal of Production Economics, Elsevier, vol. 135(2), pages 568-583.
    2. Xiong, Yu & Zhou, Yu & Li, Gendao & Chan, Hing-Kai & Xiong, Zhongkai, 2013. "Don’t forget your supplier when remanufacturing," European Journal of Operational Research, Elsevier, vol. 230(1), pages 15-25.
    3. Li, Yongjian & Wei, Cansheng & Cai, Xiaoqiang, 2012. "Optimal pricing and order policies with B2B product returns for fashion products," International Journal of Production Economics, Elsevier, vol. 135(2), pages 637-646.
    4. Hsueh, Che-Fu, 2011. "An inventory control model with consideration of remanufacturing and product life cycle," International Journal of Production Economics, Elsevier, vol. 133(2), pages 645-652, October.
    5. Chen, Chialin & Liu, Lucy Qian, 2014. "Pricing and quality decisions and financial incentives for sustainable product design with recycled material content under price leadership," International Journal of Production Economics, Elsevier, vol. 147(PC), pages 666-677.
    6. Kilpi, Jani & Töyli, Juuso & Vepsäläinen, Ari, 2009. "Cooperative strategies for the availability service of repairable aircraft components," International Journal of Production Economics, Elsevier, vol. 117(2), pages 360-370, February.
    7. Kenné, Jean-Pierre & Dejax, Pierre & Gharbi, Ali, 2012. "Production planning of a hybrid manufacturing–remanufacturing system under uncertainty within a closed-loop supply chain," International Journal of Production Economics, Elsevier, vol. 135(1), pages 81-93.
    8. Ramanathan, Ramakrishnan, 2011. "An empirical analysis on the influence of risk on relationships between handling of product returns and customer loyalty in E-commerce," International Journal of Production Economics, Elsevier, vol. 130(2), pages 255-261, April.
    9. Georgiadis, Patroklos & Athanasiou, Efstratios, 2013. "Flexible long-term capacity planning in closed-loop supply chains with remanufacturing," European Journal of Operational Research, Elsevier, vol. 225(1), pages 44-58.
    10. Hong, I-Hsuan & Yeh, Jun-Sheng, 2012. "Modeling closed-loop supply chains in the electronics industry: A retailer collection application," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 48(4), pages 817-829.


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