Optimal pricing and disposal decisions for product recovery facilities under a single portfolio
by Srikanth Vadde; Abe Zeid; Sagar Kamarthi
International Journal of Collaborative Enterprise (IJCENT), Vol. 4, No. 3, 2014

Abstract: This work presents an analytical model that can help decision makers determine the optimal price and disposal quantity for reusable and recyclable components under a single portfolio, when product recovery facilities (PRFs) proactively procure end-of-life products when the passively product returns are insufficient to satisfy the demand for reusable and recyclable components. The modes is built on the assumption that the demand for remanufactured components, which are categorised as like new, good, and acceptable, is governed by the price, obsolescence of components, customer willingness to pay, and remaining life of components. The model is verified by running it on a numerical example in which a PRF processes one particular configuration of personal computer. Even though the model gives numerical values for optimal prices, disposal quantities, and inventory levels, the emphasis is placed on verifying if the trends follow what are generally expected by experts.

Online publication date: Tue, 16-Dec-2014

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