The study of multi-dimensional reverse channels for construction machinery remanufacturing

Abstract

For the need of sustainable development, the importance of the reverse collection and remanufacturing has been widely recognized in the literature and in practice. In this paper, we analyzed three reverse channels extensively used in the remanufacturing practice, i.e. retailer collection, manufacturer collection and third party collection. The results address that the choice of single one reverse channel can hardly satisfy the demand of the construction machinery remanufacturing companies with complex market demand and the necessity of establishing multi-dimensional reverse channels which combine the application of multiple reverse channels. Specifically, considering that one remanufacturer already has an excellent forward supply chain network and suitable reverse channels to choose, we proposed a special reverse model and applied it to an actual case. According to the analysis, the conclusions can be summarized as: (1) for the remanufacturer, the third party collection is extensively necessary to him for the reduction of the expenses on establishing unnecessary reverse network, (2) the remanufacturer should make a balance between the retailer collection and third party collection to maximize the profit, while the fee paid to the third party is relatively low and the collection cost he made to the retailer collection is relatively high, the rate of the investment in third party collection could be increased in corresponding, and vice versa.