Green profit maximization through joint pricing and production planning of new and remanufactured products

Minjung Kwak, Katherine Koritz, Harrison Hyung Min Kim

Research output: Chapter in Book/Report/Conference proceedingConference contribution

Abstract

To achieve "green profit" in their business, manufacturers who produce both new and remanufactured products must optimize their pricing and production decisions simultaneously. They must determine the buy-back price and take-back quantity of end-of-life products as well as the selling prices and production quantities of new and remanufactured products. With an aim to assist in optimal pricing and production planning, this paper presents a mixed-integer programming model that optimizes the three prices (of buyback, new and remanufactured products) and the corresponding production plan simultaneously. The model considers the two conflicting objectives of maximizing economic profitability and maximizing environmental impact saving. The model helps address potential barriers to remanufacturing, which include limited economic, and/or environmental sustainability of remanufacturing, imbalance between the supply of end-of-life products and the market demand for remanufactured products, and cannibalization of the sales of new products. The developed model is illustrated with an example of engine water pump.

Original languageEnglish (US)
Title of host publication39th Design Automation Conference
PublisherAmerican Society of Mechanical Engineers
ISBN (Print)9780791855898
DOIs
StatePublished - 2013
EventASME 2013 International Design Engineering Technical Conferences and Computers and Information in Engineering Conference, IDETC/CIE 2013 - Portland, OR, United States
Duration: Aug 4 2013Aug 7 2013

Publication series

NameProceedings of the ASME Design Engineering Technical Conference
Volume3 B

Other

OtherASME 2013 International Design Engineering Technical Conferences and Computers and Information in Engineering Conference, IDETC/CIE 2013
Country/TerritoryUnited States
CityPortland, OR
Period8/4/138/7/13

ASJC Scopus subject areas

  • Modeling and Simulation
  • Mechanical Engineering
  • Computer Science Applications
  • Computer Graphics and Computer-Aided Design

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