How Does the Remanufacturing Strategy Impact Supplier Counterfeiting?

Abstract

This paper establishes a supply chain model with a supplier and a manufacturer, where the supplier may counterfeit new products. The focus of this model is on how the manufacturer's remanufacturing mode choice affects the supplier's counterfeiting behaviour. Based on consumers' perceptions of the quality of different products, the changes in the decisions of supply chain participants and social welfare are analysed. The results indicate that when the brand perceived quality of the product is at a moderate level, the manufacturer's remanufacturing can suppress the supplier's counterfeit behaviour. However, when the brand perceived quality of the product is at a high level, the supplier may be forced to counterfeit due to the manufacturer's remanufacturing, meaning that remanufacturing may exacerbate the threat of counterfeiting.

Keywords: Counterfeiting, Remanufacturing, Product Competition