A two-phase extended warranty strategy for new and reman products

P. Jalapathy and M. Mubashir Unnissa

International Journal of Operational Research, 2025, vol. 54, issue 1, 70-88

Abstract: In recent decades, waste management has attracted the attention of a substantial number of scientific and industrial firms, which paved the way for reman products. Also, reman product reliability increases significantly in the product market, and offering a warranty is the most efficient way to identify the product's quality and dependability through market sales. In this paper, a two-phase extended warranty model is offered for a new and reman product to analyse the pricing strategy of the monopolistic manufacturer. The paper develops a model framework to examine optimal prices, demands, and profits of new and reman products with an extended warranty by using the Karush-Kuhn-Tucker (KKT) condition. Further, to highlight the impact of the extended warranty, failure rates, and customer willingness on new and reman products, a numerical analysis is performed. The results reveal an insight on providing an extended warranty increases the manufacturer's profit.

Keywords: re-manufacturing; pricing strategy; extended warranty; customer utility; profit analysis. (search for similar items in EconPapers)
Date: 2025
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