Revenue management in a refurbishing duopoly with cannibalization

Refurbishing has promising economic potential, yet firms remain wary of its potential cannibalization effect on new product sales. Firms need to make strategic choices in competitive settings, involving varying brand strengths and collection constraints. The current study provides an empirical characterization consumer behavior such complex which turn informs analytical model optimal pricing policies. results show that (or switching) a environment linear relationship with price discounts, unlike the inverted U-shaped observed monopolistic settings. experimental also highlight relevance cross-cannibalization, especially for weaker (with low value) compete stronger sell refurbished products. Our subsequent reveal how both competitors should adjust their prices when internal cross-cannibalization coefficients change. Weaker focus surpassing terms refurbishing efforts, implies predominant operations. Finally, we are function of, profits concave relation to, number core products collected by firms.