Abstract:

Recycling and remanufacturing have always been seen as a favourable and effective way of dealing with the problem of used products. Recyclers often collect used products from the consumer market and sell them to manufacturers for remanufacturing at a certain transfer price. In recent years， with the growth of the secondhand economy， some recyclers have begun to resell recycled goods in the form of secondhand products. The resale of used products by recyclers reduces the amount of remanufactured material available to manufacturers， at which point the incentive for manufacturers to improve remanufacturing capabilities becomes the central question. Thus， the impact of the resale behavior of the recycler on the manufacturer’s remanufacturing capacity improvement strategy is studied. The recycler resells recycled goods as secondhand products， which on the one hand reduces the supply of remanufactured materials to the manufacture， and on the other hand competes with the manufacturer in the consumer market， whether this behavior will force manufacturers to enhance their remanufacturing capacity and set higher transfer prices to induce recyclers to reduce re-sale to alleviate the competition in the market， and at the same time， whether it can stimulate recyclers’ recycling enthusiasm to improve recycling rate. The benchmark model of no resale is established， and then the game model considering resale of the recycler is constructed. The models are solved by dynamic game and nonlinear programming theory. It is found that： Firstly， for the recycler， resale has been shown to encourage the recycler’s enthusiasm for recycling， hence increasing the recycling amount and forcing the manufacturer to set a higher transfer price. Therefore， the recycler must choose the resale strategy under the constraint that the resale is permitted. Second， for manufacturers， remanufacturing capacity is boosted if the manufacturer's remanufacturing cost savings are low， while remanufacturing capacity is not boosted if the remanufacturing cost savings are high. In addition， the analysis of recycling rate and consumer surplus reveals that recyclers’ re-selling to force manufacturers to enhance their remanufacturing capacity helps to increase the recycling rate and consumer surplus， which can achieve a win-win situation for enterprises， the environment and consumers. It is expected that this research can provide some reference for manufacturers to improve remanufacturing capacity and provide theoretical basis for recyclers to formulate resale strategies.

Key words: recycler, resale, product remanufacturing capability, closed-loop supply chain