Consumer value considerations and adoption of remanufactured products in closed-loop supply chains

• Published in: Industrial management + data systems Vol. 118; no. 2; pp. 480 - 498
• Main Authors: Wang, Yacan, Hazen, Benjamin T, Mollenkopf, Diane A
• Format: Journal Article
• Language: English
• Published: Wembley Emerald Publishing Limited 12.03.2018; Emerald Group Publishing Limited
• Subjects: Automobiles; Consumer behavior; Consumers; Ecological risk assessment; Energy consumption; Hypotheses; Innovations; Manufacturing; Marketing; Model testing; Operations management; Perceptions; Remanufacturing; Risk perception; Supply chains; Beijing China; United States > US; China; Tennessee; Structural equation modeling; Remanufacturing; Closed-loop supply chains; Diffusion of innovations; Consumer perceived value
• DOI: 10.1108/IMDS-10-2016-0437
• ISSN: 0263-5577

Purpose The success of closed loop supply chains is contingent upon consumer acceptance of remanufactured products, yet little is known about how consumers value such products. The purpose of this paper is to provide theoretical grounding for understanding consumers’ value perceptions as related to remanufactured products. Design/methodology/approach Diffusion of innovation theory and customer perceived value literature help form the theoretical model, which is tested empirically using survey data of consumers. Structural equation modeling was employed to test the hypotheses. Findings Perceived value of remanufactured products is measured as a function of perceived benefits (environmental benefits; price advantage) and perceived sacrifices (perceived quality; perceived risk), all of which are shown to impact perceived value. Additionally, perceived risk is found to partially mediate the relationship between perceived quality and perceived value. Originality/value This research makes two significant contributions. First, mid-range theory that is contextualized to the closed loop supply chain is developed to aid researchers and practitioners in better understanding the consumer’s role in the closed loop supply chain, as related to the acceptance of remanufactured products. Second, consumer acceptance of remanufactured products represents a form of supply chain demand risk that has previously been unrecognized. The results provide a foundation for incorporating this type of demand risk in to future research efforts.