Accurate Response with Refurbished Consumer Returns

Reimann, Marc (2016) Accurate Response with Refurbished Consumer Returns. Decision Sciences, 47 (1). pp. 31-59. ISSN 0011-7315

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Official URL: https://doi.org/10.1111/deci.12150

Abstract

Centering around anticipative and reactive capabilities of firms, accurate response is an important supply-side strategy to deal with demand uncertainty. Clearly, the structure of the possible reaction will crucially influence the optimal anticipative decision making. In this article, we extend the existing literature in this area by including a new reactive capability, namely the utilization of refurbished consumer returns from early sales to react to demand later in the selling season. Because consumer returns depend on previous sales, there is also a direct link to the anticipative supply decision. We capture this effect in a newsvendor-type model and provide both analytical and numerical insights into the optimal anticipative and reactive decisions as well as the value of refurbishing in terms of the retailer's expected profitability.

Item Type: Article
Uncontrolled Keywords: Accurate response, closed-loop supply chain, consumer returns, refurbishing
Subjects: N100 Business studies
Department: Faculties > Business and Law > Newcastle Business School > Business and Management
Depositing User: Becky Skoyles
Date Deposited: 15 Mar 2018 14:23
Last Modified: 15 Mar 2018 14:23
URI: http://nrl.northumbria.ac.uk/id/eprint/33756

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