A PRELIMINARY PAPER ON UNDERSTANDING OF INTERACTION BETWEEN

NEW PRODUCT (NEW CARTDRIDE) AND REUSED PRODUCT (REUSED

CARTRIDGE) by Muhamad Khairul Bahri

This paper explore system thinking of refilled/reused/recycled printer cartridge. In this paper, we’re
examining a causal loop how new-cartridge compay, consumer and refilled-cartridge company
interact and what behavior of this interaction.
This causal loop, however, will help better understanding about what we shall propose to unite
environmental and economic benefits from wider uses of reused cartridges.

New-Product +
Companies’s Profit
Negative +
Loop 1 Negative
+ + Loop 2 -
Number of New-Product New-Product Supply Raw Material Availability
Companies
-
+
New-Product Price

- Negative
+ Loop 3
Population Consumer Demand

+
+
Environmental Issues like global warming,
Waste Products
more spacious of waste treatment.

In the first causal loop, we find that abundance waste cartdridges can be environmental causes, if
this abundace wastes not to be recycled. Because abundance of waste product will need more space
and additional cost. For example, after using some new cartridges, consumers will send it to garbage
and pay additional cost to send these waste to final waste treatment. It also can cause more CO2
released to sky after burning waste products (global warming phenomenon).

Another important environmental issue is raw material availability. A cartdridge includes some raw
materials that categorized as non-renewable materials including metal and ink. In long period, this
scarcity will lead to decrease new-product supply as well as the higher price of new products.
Another factor enhance new-product price is population. As population grows, new-product price
pushed rise. Both factors, scarcity and growing population, are leading the higher price of new
products.
 Abundance waste products and need of lower priced products push some businessmen to start
refilled/reused-product company. This occurrence lead to negative loop which reduce product
garbage and minimize environmental impacts. Negative loop 61 shows that reused-product
companies threat new-product companies because of its lower price in that consumer 1 prefer to
buy reused products.

Let we expand the first causal loop as follows:

New-Product +
Companies’s Profit
Negative +
Loop 1 Negative
+ + Loop 2 -
Number of New-Product New-Product Supply Raw Material Availability
Companies
-
+
New-Product Price

- Negative
Population + Loop 3
Consumer 1 Demand
-
+
+
Environmental Issues like global warming,
Waste Products
more spacious of waste treatment.
+
+
+ -
The company’s profit Reused-Product Companies More
Employment
+ +

Negative Reused/ Recycled-Product Supply

Loop 4 -
- +
Price Ratio
Reused-Product Price
+ +
Negative
-
Loop 5
Intelectual Property +
Consumer2 Demand
Fee / Charge Rate of Customer 1 to be
+
Costumer 2
Negative
Loop 6

1
Negative Loop 6 includes Consumer 1 Demand – Waste Products – Reused Product Companies – Reused
product supply – Reused product price – price ratio – Consumer 1 Demand.
In this revised causal loop, we change “consumer” entity to be “consumer 1” to differ this one to
entity of consumer 2. Consumer 1 is a new-product buyer and Consumer 2 is a reused-product
buyer. We introduce a new variable, namely price ratio which a result of comparison between new-
product price divide by reused-product price. The higher this ratio, the more consumer 1 will be
consumer 2 as well as the higher rate of costumer 1 to be costumer 2.

As costumer 1 lead to be costumer 2, new-product companies will face a decreased market size as
well as profit and tend to go to ruined (bankruptcy) era. New-product companies must preserve
their existence, for example, by charging reused-product companies an approriate tariff to enhance
their profit. This charge can be a repsentative of intelectual property fee.

We can put this charge policy and relate it to reused product price. The higher charge, the higher
reused product price. In this situation, the charge policy has a chance to balance market share of
both companies, new-product and reused-product companies.

THE NEXT STEP

After building the causal loop, we shall build a flow diagram model to understand this phenomenon
behavior. A flow diagram can be built in Vensim, Powersim, Stella or Ithink (or other System
Dynamics Sofwares). While building a flow diagram, we can quantify all variables based on historic
(time series) data. The flow diagram, a computer model, can be used to understand effect of charge
policy to both company types.
GLOSSARY

1). + sign means both variables are inline / same direct, vice versa.
For example, more new product companies profit will enhance number of new product
companies so that this relation has + sign. In other side, higher new product price will lead to
lower consumer demand. This term has – sign.

2). Negative Loop and Positive Loop

If some relations be a positive loop, so-called reinforcing loop, it means all variables in the
loop to go to growing state. It might to go to chaos.
Otherwise is a negative loop, so-called balancing loop, means all variables interact to go to
steady state.