Abstract:

Recently, in the industries of engineering machinery and construction equipment, a few distributors begins to engage in remanufacturing. Based on this, the multi-period closed-loop supply chain (CLSC) network equilibrium problem is studied when the distributors remanufacture the end-of-life (EOL) products. The distributors collect the EOL products at the end of each period and sell a part of them to the manufacturers. The remainder of EOL products is used for remanufacturing themselves. In addition, it is assumed that the manufacturers can select the remanufacturability level in the phase of product design. Using the variational inequalities and Lagrange duality theory, the Nash equilibrium conditions of various players are obtained, and then the equilibrium model is established. The model is solved by modified projection contraction algorithm. Then numerical examples are provided to analyze the impact of remanufacturing conversion rate of the distributors and the ratio of the EOL products sold from the distributors to the manufacturers on the profits of various players and remanufacturablity level. The results show that in most cases the distributors’ remanufacturing benefit themselves and the whole CLSC network, but the manufacturers’ profits decrease, therefore a suitable profit allocation mechanism should be designed to implement Pareto improvement; when the conversion rate increases, the higher of the conversion rate value is, the better the distributors are. However, the manufacturers’ profits increase slowly.

Key words: distributor engaging in remanufacturing, multi-period, remanufactureability design level, closed-loop supply chain