Design of the reverse channel for the third-party remanufacturing considering consumer education

¹ School of Management, University of Science and Technology of China, 96 Jinzhai Road, Hefei, Anhui 230026, P.R. China
² School of Economics, Hefei University of Technology, 193 Tunxi Road, Hefei, Anhui 230009, P.R. China

^* Corresponding author: fengyang@ustc.edu.cn

Received: 23 September 2020
Accepted: 28 September 2021

Abstract

Different stakeholders pay more attention to consumer education for remanufacturing. They expect to promote the advancement of the remanufacturing industry by increasing the number of consumers willing to pay for remanufactured products. In the context of consumer education, this paper investigates the influence of different collection and remanufacturing capabilities on the reverse channel designs. The results show that increased consumer education makes the OEM partially forgo the remanufacturing right and more focus on the control of the collection process of reverse channels. We further explore the impact of consumer education on different stakeholders. We find that consumer education significantly improves individual profits and supply chain profit. However, for consumers, the temperate consumer education is all-around desirable, and excessive consumer education will reduce consumer surplus. For the environment, only when the environmental friendliness of RPs is relatively high, improving consumer education will reduce the environmental impact. Furthermore, we also examine the reverse channel designs from multiple criteria and discover that profitability, consumers, and environmental goals can be consistent under certain conditions. Our study provides new insights for the design of reverse channels in the context of consumer education.