A time-varying lot sizes approach for the economic lot scheduling problem with returns

Abstract

We consider the economic lot scheduling problem with returns by assuming that each item is returned by a constant rate of demand. The goal is to find production frequencies, production sequences, production times, as well as idle times for several items subject to returns at a single facility. We propose a heu ristic algorithm based on a time-varying (TV) lot sizes approach. The problem is decomposed into two distinct portions: in the first, we find a combinatorial part (production frequencies and sequences) and in the second, we determine a continuous part (production and idle times) in a specific production sequence. We report computational results that show that, in many cases, the proposed TV lot sizes approach with consideration of returns yields a relatively minor error.