Choosing optimal reverse channel structures for the collection of used products

Date
2017-03
Journal Title
Journal ISSN
Volume Title
Publisher
Stellenbosch : Stellenbosch University
Abstract
ENGLISH SUMMARY : The re-manufacturing of used products has become more important in literature and practice. Governmental legislation forces manufacturers to take care of their end-of-life products. Additionally, re-manufacturing may increase a companies' revenue through direct savings in production costs by the recovery of valuable material. With these external and internal developments, there is a growing interest of manufacturers in determining an optimal channel for the collection of used products. The overall objective of this optimisation lies in the maximisation of the companies' profit. Therefore, the problem of increasing waste streams of end-of-life products need to be addressed by identifying the most protable reverse channel structure to collect and re-manufacture used products. Three different collection channel options are modelled as decentralised decision-making systems. Therefore, a game theory approach is applied. The first channel is the manufacturer carrying out the collection. The retailer making use of the retail store network to collect from customers and sell back to the manufacturer describes the second channel. A third-party logistics service provider acts as a third channel for collecting and selling returns. The thesis focuses on the detailed cost of collection that each potential collecting agent accommodates. A non-cooperative game between the three collecting agents is modelled first, followed by the extension to a cooperative game. The cooperation can be caused by external in influences like legislative regulations or by a change in perspective. The stability of both versions of the game is evaluated by changing single parameters. Additionally, by changing the market scenario, the influence of the market environment on the channel choice is investigated in particular. The benchmark scenario of the non-cooperative and cooperative version of the game is stable in its parameters. In general, changes in single parameters influence the level of the highest payoff achievable by each player. In the non-cooperative version of the game the manufacturer gains the highest payoffs followed by the retailer, as both benet from the sales of new products. If the market scenario is changed, this ranking only shifts with a change in the market area size. Therefore, the retailer obtains a prot higher than the manufacturer. The third-party is able to work with different clients, turning the collection of returns into a successful business. The results of the cooperative version of the game are consistent with the observations in the non-cooperative game. Forming the grand coalition is the best option to obtain the highest payoffs if collection rate fees are imposed externally. With a change of perception to the manufacturer, the same customer density identifies the retailer as an optimal collection channel. However, subcontracting the third-party obtains the highest payoff in the benchmark scenario as well as in the larger market areas. In conclusion, a cooperation between different options should be taken into account while designing optimal reverse channel structures for every scenario. Additionally, the point of view is crucial in choosing the partner to obtain the highest payoff.
AFRIKAANSE OPSOMMING : Die hervervaardiging van gebruikte goedere word al hoe noodsaakliker in sowel die literatuur as in die praktyk. Regeringswetgewing dwing vervaardigers om produkte te verwerk wat die einde van hul raklewe bereik het. Die hervervaardiging van produkte kan tot voordeel van ‘n maatskappy se inkomste wees deur direkte besparing in vervaardigingskoste wanneer waardevolle material herwin kan word. Met hierdie eksterne en interne ontwikkeling is daar ‘n toenemende belangstelling van vervaardigers om ‘n optimale kanaal vir die versameling van gebruikte produkte te skep. Die algemene doelwit van hierdie optimering le in die maksimering van die maatskappy se wins. Daarom is dit noodsaaklik dat die probleem van toenemende afvalhope van produkte aan die einde van hul raklewe aangespreek word deur die mees winsgewende tru-kanaalstruktuur te skep waardeur hierdie produkte versamel en hervervaardig kan word. Daar is drie verskillende versamelingskanale wat as modelle kan dien vir gedesentraliseerde besluitnemingsisteme. ‘n Model wat op ‘n speleteorie benadering gebaseer is, word gebruik. Die eerste kanaal is die vervaardiger wat die versameling behartig. Die tweede kanaal is die kleinhandelaar wat gebruik maak van die winkelnetwerk om die produkte van die kliente te versamel en terug te verkoop aan die vervaardiger. Die derde kanaal is ‘n onbetrokke logistieke diensverskaffer wat die produkte wat teruggegee is, versamel en herverkoop. Hierdie tesis focus op die gedetailleerde koste van die versameling van elke potensiele versamelingsagent. ‘n Niesamewerkingspel tussen die drie versamelingsagente is die eerste model, gevolg deur ‘n uitbreiding na ‘n samewerkingspel. Die samewerking kan veroorsaak word deur eksterne invloede soos wetgewende bepalings of deur ‘n verandering in perspektief. Die stabiliteit van beide weergawes vanuit ‘n speleteorie benadering word getoets deur enkele parameters te verander. Deur die mark scenario telkens te verander, word die invloed van die markomgewing op die keuse van die tipe kanaal ook ondersoek. Die scenario wat die maatstaf vorm vir die nie-samewerkings en die samewerkings weergawe van die spel is stabiel in terme van die invoer parameters. Oor die algemeen word die vlak van die hoogste wins wat elke speler kan bereik, deur veranderinge in enkele van die parameters beinvloed. In die nie-samewerking weergawe van die spel word die meeste wins deur die vervaardiger gemaak, gevolg deur die kleinhandelaar, aangesien albei voordeel trek deur die verkope van nuwe produkte. As die mark-scenario verander, verander die rangorde slegs met ‘n verandering in die grootte van die markgebied, en word die verkoper se wins meer as die van die vervaardiger. Die derde party kan met verskillende kliente werk en die versameling van goedere in ‘n suksesvolle besigheid verander. Die uitslag van die samewerkings weergawe van die spel is konsekwent met die van die nie-samewerkings weergawe. Die omvattende koalisie is die beste keuse om die hoogste wins te maak, indien die koste van die versameling ekstern gehef word. Ter samevatting, ‘n samewerking tussen verskillende moontlikhede moet in berekening gebring word wanneer die optimale tru-kanaal struktuur vir elke scenario geskep word. Voorts is hierdie standpunt van uiterste belang wanneer ‘n vennoot gekies word om die hoogste wins te verseker.
Description
Thesis (MCom)--Stellenbosch University, 2017.
Keywords
Reverse logistics, Closed loop supply chain, Game theory, Operations research, Salvage (Waste, etc.), UCTD
Citation