Remanufacturing for the Circular Economy: An Examination of Consumer Switching Behavior

Abstract

For the circular economy to be tenable, consumers need to not only return products after use, but also purchase products that are remanufactured. However, research finds that consumers have a poor opinion of remanufactured products and are typically not prepared to adopt them. Thus, development of the circular economy is dependent upon deeper understanding of consumers’ attitudes and behaviors. Research typically considers either micro‐level or macro‐level factors when assessing consumer perceptions of remanufactured products. The current research incorporates macro‐level factors of price, government incentives and environmental benefits with the moderating influence of micro‐level consumer attitudes to examine consumers’ intention to switch from purchasing new products to remanufactured products. The findings suggest that a consumer's attitude toward remanufactured products is an important moderating factor predicting consumer switching behavior to remanufactured products. Copyright © 2016 John Wiley & Sons, Ltd and ERP Environment

Supply Chain Configurations in the Circular Economy: A Systematic Literature Review

“…Studies on the macro-level of cities [44][45][46], economic areas [47,48], and national and global industries, particularly logistics and waste [7,14,[49][50][51][52], were only included if they informed implementation on the meso-level, as per the inclusion and exclusion criteria. Other implementation studies focus on reviewing and informing policy [13,16,17,[53][54][55][56][57][58][59][60][61][62][63][64][65][66][67], specifically on product design for the CE [8,9,14,[64][65][66] as well as assessments of firms' [67,68], consumers' [69][70][71], and officials' [72] awareness of and attitudes towards the CE's concepts and its components. Two contributions are concerned with business model research [73,74].…”

“…While the literature, particularly on China as a country heavily affected by environmental pollution [46,63], cautiously sees a paradigm shift [2], this does not necessarily translate into changes in consumer behaviour [70,71,79], enthusiasm by firms [38,68], or governmental support or incentives to transition [15,44,45]. Bocken et al's [67] recent study of Standard & Poor (S&P) 500 firms' uptake of the CE concept shows that while the CE is present in business, academia, and policy, more radical CE business models are not considered by large companies.…”

“…Authors therefore propose governments to actively promote public participation in and generate preferences for green products [13,15,16,44,57,69,74]. This is to achieve higher recycling rates and general conservation of resources [59,71] as part of a conservation-oriented society [16], as well as allow firms to monetize CE activities by asking for higher prices [68] or sell remanufactured products [70]. Geng and Doberstein [16] note that the Chinese government is currently ill-equipped to generate such participation however, and Xue et al [72] find that Chinese officials focus on the CE development of industry rather than on public participation.…”

“…Embedding such novel products in profitable business models to recuperate the investment in the product and support the SC infrastructure is another challenge [7][8][9]14,70,73,74] that in some cases hinges on top-down intervention or subsidies to become feasible [37] or might not be financially successful despite superior environmental performance [34]. Product-service systems (PSSs) are claimed to be one possible vehicle to monetize design and maintenance efforts through long-term customer relationships, but are difficult to implement successfully due to SC infrastructure requirements and persisting consumer reservations [7,8], especially if the subsequent product should be remanufactured instead of being new [70].…”

“…Product-service systems (PSSs) are claimed to be one possible vehicle to monetize design and maintenance efforts through long-term customer relationships, but are difficult to implement successfully due to SC infrastructure requirements and persisting consumer reservations [7,8], especially if the subsequent product should be remanufactured instead of being new [70]. Jensen and Remmen [33] strengthen the argument for PSSs by showing how product stewardship initiatives in a number of industries have engendered environmentally better end-of-life management and Mendoza et al [73] provide a framework on how firms can innovate and transition to such novel business models.…”