This study is an effort to understand the impact of cannibalization on product return under different demand scenarios during product life cycle. A system dynamic model is used to estimate product return for a hypothetical product P. The results of the study reveal that product return increases with increasing product demand during growth stage under the exposure of cannibalization, and product return decreases with increase in cannibalization during maturity stage. Original Equipment Manufacturers (OEMs) can venture into remanufacturing during growth stage and it can lead to capital investment saving at initial product life cycle stage. However, during maturity stage venturing is not recommended.

A remanufacturing system of Original Equipment Manufacturers (OEMs) is primarily dependent on product returns. The product returns depend on several product-related, firm-related and market-related factors, e.g., the stage of product life cycle, sales volume of product, competitors (OEMs, remanufacturers and small, no name/non-branded manufacturers), as well as the customer segment (newness-conscious-oriented, functionality-oriented and environment-conscious).

From a microscopic view to OEMs’ strategies and operations, it is discovered that remanufacturing has not been given proper consideration to exploit its full potential for competitive advantage. This can be solely attributed to the fear of cannibalization and loss of market sales (due to perceived inferior quality of remanufactured products).

Operations Management Journal, Impact of Cannibalization, Original Equipment Manufacturers (OEMs), return rate, quality, quantity, German Recycling and Waste Control Act, California’s Electronic Waste Recycling Act, European Electronic, Electrical Waste Act, entry timing Product Returns, Remanufacturing, Different Demand Scenarios.