Remanufacturing Decisions with WTP Discrepancy and Uncertain Quality of Product Returns

In a remanufacturing system, the uncertain quality of the product returns tends to impact the manufacturer’s price of returns and remanufacturing. This article introduces the quality coefficient of waste products on the basis of the analysis of the structure of the remanufacturing cost. It explores the remanufacturing cost function, the recycling price function, and the recycling rate function. In the marketing process, new products compete with remanufactured products. Different consumers show different levels of degrees of acceptance of remanufactured products, contributing to the uncertainty of the willingness to pay for remanufactured products. The price of remanufactured products is always lower than that of new products, allowing price-sensitive consumers to turn to remanufactured products. This shows that product pricing has an impact on the market demand. Considering the difference between consumer willingness to pay and the quality of product returns, this article aims to construct a game model consisting of manufacturers, retailers, and consumers, with the manufacturers as leaders. The optimal pricing decisions of the production in supply chain members have been solved, and sensitivity of the model is analyzed through examples.