Starting from mid '90s, Eco-efficient Product Service Systems (PSSs) were indicated in literature as enablers toward a more sustainable and resource-efficient industry through re-use and remanufacturing. In this regard, academicians and practitioners outlined several advantages (environmental and economic) but also many barriers hindering their implementation, such as market acceptance and economic sustainability. Thus, the diffusion of re-use and remanufacturing PSS is currently limited and mainly restricted to markets accepting also out-dated products (e.g. B2B or emerging countries). To cope with this limitation, product upgrade in re-manufacturing was recently introduced. Upgrade cycles allow embedding technological innovation into products while remanufacturing, thus reaching advanced performances and satisfying evolving customers' preferences over time. If coupled with the offering of advanced services, remanufacturing with upgrade would open the way to new disruptive PSSs able to revolution customers' consumption behaviour, as well as the manufacturing business model of companies. The new remanufacturing with upgrade business models will make remanufacturing one of the main pillars of companies' business value generation, allowing improved management of technology cycles and of products obsolescence. Thus, overall economic and environmental benefits will be maximised. However, the implementation of such business models represents a challenge for manufacturers. The evolution from a pure manufacturing towards a manufacturing/remanufacturing company, together with the transition from a product to a service-based offering, entails considerable changes in all the business model variables. Drawing on the theory of business model innovation process, incremental or radical innovation paths can be hypothesised for this transition. Despite the focus of recent research on Product Service Systems and on Circular Economy, remanufacturing-with-upgrade business models are rarely cited in literature and there is limited empirical evidence of companies having embraced them. To set the research framework in alignment with previous theory, this paper proposes a structured definition and configuration of innovative remanufacturing-with-upgrade business models. By looking at existing examples of companies having undertaken this type of business model innovation, different typologies of remanufacturing and upgrade business models are proposed. Companies were classified according to the identified PSS typologies and conclusions are derived, together with future research perspectives. (C) 2018 CIRP.
