We aim to add new case studies at intervals to illustrate the three main types of remanufacturing business model and to highlight aspects that may be instructive to policy makers.
Remanufacturing business models can be categorized into three main groups: independent third parties, approved third parties and OEM in-house.
- Independent third parties are often the first to discover the business opportunity and go on to develop the market for the remanufactured product. However, this discovery process comes at a cost to independent third parties, who are subject not only to legal challenges but also to the risks associated with the supply of spare parts. Many of them overcome these challenges but others do not.
- Approved third parties on the other hand are appointed by Original Equipment Manufacturers (OEMs) and usually have direct access to the technical designs, spare parts and intellectual property (IP) that may be necessary to refurbish or remanufacture the product.
- The third main category of OEM in-house is that in which an OEM manages the take-back and remanufacture of their own products. The fastest growth appears to be occurring in the approved third-party category because OEMs increasingly recognize the value opportunities from a take-back process but want to manage it at arm's length.