Why aren't consumers buying remanufactured products?

Jul 29, 2014 by Victoria Fryer

Firms looking to increase market share of remanufactured consumer products will have to overcome a big barrier to do so, according to a recent study from the Penn State Smeal College of Business. Findings from faculty members Meg Meloy and V. Daniel R. Guide Jr., indicate that consumers perceive many categories of remanufactured products as dirty and disgusting.

Remanufactured products, also known to consumers by terms such as refurbished or rebuilt, are products that have been disassembled, cleaned, and—after replacement of any worn or defective parts—reassembled and returned to the market. They represent a significant opportunity for businesses aiming to increase sustainability, but currently they only account for about 5 to 10 percent of the consumer market.

Part of the reason these products haven't gained greater is the consumer perception that many of these products are dirty or disgusting—despite the thorough sterilization process that products undergo as part of the remanufacturing process. Disgust plays a particularly strong role when the remanufactured products are used for food preparation (e.g., a food processor) or personal care (e.g., an electric toothbrush).

"The perception that remanufactured products are somehow dirty and disgusting due to their prior ownership adds a previously undocumented and powerful predictor of remanufactured product attractiveness," the authors wrote. "Fully mitigating these negative perceptions … may prove difficult."

The upside of this market is that remanufactured products are more environmentally friendly. Consumers are often more willing to adopt remanufactured technology products (e.g., smart phones or tablets).

"Because remanufactured products derive from direct reuse (in contrast to new or recycled products), the environmental impacts of production can be lower than for new products," write the authors.

But contrary to their hypothesis, the authors found that consumers who self-identified as being committed to environmentally friendly practices and products did not necessarily have a significantly more positive perception of remanufactured products.

"Such a finding indicates that some green-minded consumers may not fully appreciate the potentially environmentally friendly or green attributes of a remanufactured product."

The authors indicate that remanufacturers will need to reduce consumer perceptions of disgust directed at these products in order to make them more viable. Reminding consumers of the aspects of remanufactured products may increase "green" consumers' positive perceptions of these products and, thereby, hold promise as one way to potentially remove the barrier to this market.

Explore further: 'Green' scale helps predict how consumers buy environmentally friendly products

More information: Abbey, J. D., et al. "Remanufactured Products in Closed-Loop Supply Chains for Consumer Goods." Production and Operations Management (2014), DOI: 10.1111/poms.12238

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Doug_Huffman
2 / 5 (4) Jul 29, 2014
Quality has been commoditized/commodified and these products have already demonstrated failed quality. Like a used car (product) advertised as "really great, like new," then why sell it if its so good?

If remanufactured products are so good, then multiply the basic warranty by some significant factor.
Noumenon
2.5 / 5 (4) Jul 29, 2014
Such a finding indicates that some green-minded consumers may not fully appreciate the potentially environmentally friendly or green attributes........ Reminding consumers of the environmentally friendly aspects of.....


It has little to do with "getting the word out" or "educating people". The world has received the environmentalists message ad nauseam.

It is about human behavior,.... individuals are egoistically motivated and will not behave for the benefit of the collective before their own best interests. Even Climate change enthusiasts behave the same as the deniers for the most part.

The above study is not surprising at all,... in fact the core findings are not about re-manufactured products, but rather an indictment of the failed mentality of liberal progressives,.....
Noumenon
2.8 / 5 (4) Jul 29, 2014
...... which is predicated on the notion that social engineering of human behavior and thus loss of liberty, is justified for some collective ideal, .... it's the same old historic experiment that has resulted in the loss of millions of lives,... now only cloaked in "environmentalism",... it is the far leftest mentality of "progressive liberalism".

They are at core anti-capitalists, and advocate for intrusive and coercive government controlling your lives. They ignore inconvenient facts, ...that capitalism is more in line with human behavior, and that the combination of egoism and capitalism has been the greatest force for economic progress, and the state of human well being, in human history.
Noumenon
1.3 / 5 (3) Jul 29, 2014
Quality has been commoditized/commodified and these products have already demonstrated failed quality.


That is a fact, but you're assuming that the environmentalist mentality is subject to rationality and facts.

It does not matter to them that had re-manufactured products intrinsic value onto themselves then people would naturally desire them en masse, and would not need to be "educated" about it.

Nor does the fact matter to them that humans behave individualistically and not for some collective cause,.... nor that advocating a mentality that is counter to egoism and free market operates counter to nature, and so will NEVER work.

They also ignore the fact that the manufacturer of NEW products provides more jobs, raises the standard of living, strengthens economies,... and therefore supports the conditions necessary for alternative energy markets to compete.

ryggesogn2
4.2 / 5 (5) Jul 29, 2014
Products would have to be designed for dis-assembly and repair. Few products are designed for repair.
Mayday
5 / 5 (4) Jul 29, 2014
I've never had much problem with refurbished products. Quite the contrary, in fact. I know a refurbished product has likely been more carefully assembled (by a human, not a robotified stream of hung-over assembly-line workers) and has been inspected to verify that it functions properly. I have a refurbished blender on my counter that has worked faithfully and daily for more than a decade.
Mayday
5 / 5 (3) Jul 29, 2014
Noum, I enjoy capitalism greatly, but you're overselling it to the point of sounding like an anti. You almost had me convinced that us humans need saved from it. Which I do not agree.
Mayday
4.3 / 5 (3) Jul 29, 2014
Rygg, I think you'll find that most durable goods can be disassembled and reassembled, given the right tools and training. Just ask a shoemaker.
Noumenon
1 / 5 (1) Jul 29, 2014
Noum, I enjoy capitalism greatly, but you're overselling it to the point of sounding like an anti. You almost had me convinced that us humans need saved from it. Which I do not agree.


How so?
ryggesogn2
4.2 / 5 (5) Jul 29, 2014
Rygg, I think you'll find that most durable goods can be disassembled and reassembled, given the right tools and training. Just ask a shoemaker.

I had nice pair of Vasque boots. The rubber sole separated, material failure. Vasque could not re-sole the boots.
I had a nice pair of Ecco shoes with a worn sole. I could have the sole replaced, but not with an original sole.
Repair must be designed in. Bonding materials today are so good, failures occur in the surrounding material, not the bond joint.
Mayday
5 / 5 (4) Jul 29, 2014
Noum, I would argue that optimizing the productive potential of human competitiveness and creativity (also known as capitalism) does not necessitate a world of disposable or environmentally wasteful goods. Your ideas that such a world speaks well for employment and strengthened economies sounds like you are arguing against capitalism and painting it as a wasteful and environmentally destructive force. It is not. In fact, if we're lucky, and humans rise to their creative potential, our planet will be saved by it.
Mayday
4 / 5 (1) Jul 29, 2014
Regarding the study, did they segment out people who have purchased refurbished vs not? Or are they attempting to imply that people tried it and then found it disgusting. I imagine that after one try much of their "disgust" will evaporate. And all of it will evaporate when the price drops low enough.
Noumenon
3 / 5 (1) Jul 29, 2014
@Mayday, ....I'm not 'against' re-manufactured products per se; if such a niche market naturally develops on account of an Intrinsic Value in them, then evidently it makes economic sense, .....whereas simply asking people to buy re-manufactured products because "it's the right thing to do for the planet" is counter to how humans, who are egoistic in nature, will actually behave,... as the above study attests to.

Because it is already in the best interest of capitalists to manufacture New products as efficiently and cheaply as possible,... and it is at the same time in the best interest of consumers to desire the best quality at the best price,.... it is clear that manufacturing has become more and more efficient in time, and that New products drive the economy and innovation,... not the reduction of consumption.
Noumenon
1.7 / 5 (3) Jul 29, 2014
... the premise of the far left is that Consumption (and standard of living) is the problem,... and therefore that needs to be regulated,... thus the notion of re-using products irrespective of the economic validity of doing so, and irrespective of any egoistic motive for doing so. They tacitly admit both counts by providing an idealistic environmental motive rather than relying on the far more substantive capitalistic/egoistic mechanisms already in play.

They arbitrarily define the effects of human existence on the planet as somehow unnatural, as if we could get out of our own way. The anthropogenic increase in CO2 in the atmosphere is a purely natural occurrence, ...as is the migration and adaptation to climate by humans.
TegiriNenashi
5 / 5 (2) Jul 29, 2014
People are already buying used products in huge quantities. Most of home sales are existing homes. The total of materials used in a typical building structure dwarfs electronics people consumed in their lifetime.
Noumenon
2.8 / 5 (4) Jul 29, 2014
People are already buying used products in huge quantities. Most of home sales are existing homes. The total of materials used in a typical building structure dwarfs electronics people consumed in their lifetime.


Similarly with used cars, etc. If the motive is egoistically based, then the used market will already occur within the arena of capitalism.

The political far left feels a need to 'reinvent the wheel' based on a utopian environmental ideology, because they think in terms of 'collectivism', so they equate egoistic motives, consumption and high standards of living, as bad.
cjn
3.7 / 5 (3) Jul 29, 2014
I've never had much problem with refurbished products. Quite the contrary, in fact. I know a refurbished product has likely been more carefully assembled (by a human, not a robotified stream of hung-over assembly-line workers) and has been inspected to verify that it functions properly. I have a refurbished blender on my counter that has worked faithfully and daily for more than a decade.


Yep, I agree. I have a refurbished phone, tablet, computer, etc... and have never had a problem with the object as delivered (may have had problems with performance or other intrinsic property). It kills two birds with one stone as far as I'm concerned.
supamark23
1 / 5 (4) Jul 29, 2014
Yeah, who wants someone else's broken crap? It might have been repaired but that doesn't mean that other parts aren't going to fail (and that's more likely in a refurb electronic part where one failure can lead to stress/failure of other parts easily).
ryggesogn2
4.3 / 5 (3) Jul 29, 2014
Yeah, who wants someone else's broken crap? It might have been repaired but that doesn't mean that other parts aren't going to fail (and that's more likely in a refurb electronic part where one failure can lead to stress/failure of other parts easily).

Refurbished electronics are likely a better deal as electronics failures follow a bathtub shaped curve, high initial failure rates, then low, stable rates, and finally, increasingly high failures.
Consider refurbished electronics as passing the burn-in phase.
tadchem
3 / 5 (2) Jul 29, 2014
People are becoming distrustful of euphemisms. "Remanufactured" (5 syllables) means "used" (1 syllable) in most peoples' minds, and they resent the euphemism as a perceived effort to mislead them.
Call it 'used' and sell it as 'used' and it will sell. Call it anything else and people will suspect you are trying to either hide something from them or to jack up the price even more.
TegiriNenashi
3.3 / 5 (3) Jul 29, 2014
The economics of remanufacturing electronics is just not there. First, what is the volume of remanufactured goods vs. new ones? It is influenced by extremely low fault rates, so is it 5, 10% at best? Then, manufacturer have additional expenses: you have to hire people that have to examine the thing and find out what is wrong with it, and then, somebody to swap the faulty PCB. Under no circumstances they would go as far as localizing the faulty discrete element and resoldering the good one. With the whole thing (system-on-chip) costing as low as $5 it is actually cheaper just to trash it away.
skills4u
4.7 / 5 (3) Jul 29, 2014
Rygg, I think you'll find that most durable goods can be disassembled and reassembled, given the right tools and training. Just ask a shoemaker.

I had nice pair of Vasque boots. The rubber sole separated, material failure. Vasque could not re-sole the boots.
I had a nice pair of Ecco shoes with a worn sole. I could have the sole replaced, but not with an original sole.
Repair must be designed in. Bonding materials today are so good, failures occur in the surrounding material, not the bond joint.

Shoes/clothing are not durable goods!
alfie_null
5 / 5 (1) Jul 30, 2014
. . . the combination of egoism and capitalism has been the greatest force for economic progress, and the state of human well being, in human history.

Lofty. I suppose for some definition of economic progress and some definition of human well being, these two could be equated. As most people understand the terms, not so. Or do you only consider capitalists to be humans?
Pawl
5 / 5 (1) Aug 03, 2014
I think that a lot of the comments here illustrate part of the problem with remanufactured products in the marketplace. "Remanufactured" does not mean that the product was broken or defective, it means that someone decided to go with another product. Refurb computers are a case in point, phones another, in that for whatever reason, the original product no longer met the users' needs. This in no way indicates that the product was defective, as in being broken or experienced a failure.
ryggesogn2
not rated yet Aug 03, 2014
One reason for not buying such products is the price.
If the price is low enough compared to new, it will sell.
skills4u
not rated yet Aug 10, 2014
1st,If remanufactured means like new , then why is every one I have come across have a warranty 1/3 or so of the original warranty ? 2nd, the discount price for remanufactured is not far enough from the new price.3rd they will not list what was repaired, if it breaks on me I want to know it is not the same problem again.

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