In this section, you can access to the latest technical information related to the FUTURE project topic.

Towards sustainable consumption and production: Competitive pricing of modular products for green consumers

Concern for unsustainable development has peaked, and promoting and devising sustainable production and consumption is vital. Therefore, via an analytical model, we examine the impact of modularity and consumer sensitivity to sustainability on the pricing decisions of two competing firms. Consider an environmentally conscious (green) consumer who will buy one of two available, horizontally differentiated products: a modular product (M) manufactured by Firm M or a standard product (S) manufactured by Firm S. Firm M can take advantage of its modular production technology and product return policy. For such a consumer-driven demand setting, we develop a model and solve to optimality a single-stage, non-cooperative game where both firms simultaneously set their competitive prices. In addition to analytical expressions for the optimal prices and the profits for both firms, we provide structural results and numerical examples to render practical insights: The refund rate has a strong impact on profits; sensitivity of product greenness can be increased by conscientious advertising, and the reusability of modular parts encourages lower pricing and higher market share. We assert that modularity is a strong concept and practice in developing sustainable products and thereby in production, which, in turn, may enhance sustainable consumption. This study's findings have direct implications for reverse supply chain management, and firms should take these findings into account early in the product design phase.

» Author: Hilda C. Martínez León, Javier Calvo-Amodio

» Reference: Journal of Cleaner Production, Volume 142, Part 4

» Publication Date: 20/01/2017

» Source: ScienceDirect - GPP

« Go to Technological Watch



AIMPLAS Instituto Tecnológico del Plástico

C/ Gustave Eiffel, 4
(València Parc Tecnològic) - 46980
PATERNA (Valencia) - SPAIN

PHONE

(+34) 96 136 60 40

EMAIL

Project Management department - Sustainability and Industrial Recovery
life-future-project@aimplas.es