Cyclic manufacturing and remanufacturing in a closed-loop supply chain

Abstract

The implementation of a cyclic production scheduling approach has been shown to enhance resource utilization and to improve shop floor control. Recently, closed-loop supply chain management has become a topic of strategic importance due to its positive environmental and economic impacts. As a result, many organizations integrated manufacturing and remanufacturing operations to optimize the efficiency of their forward and reverse supply chain processes. The focus of this research is to integrate cyclic production scheduling policies in a two-stage closed-loop supply chain. The problem is formulated as a mixed-integer linear program to generate an optimal cyclic production schedule with no demand shortages that minimizes the sum of holding and setup costs under a given cyclic delivery schedule required by the customer. The results of the sensitivity analysis revealed that the number of products, the product return rate, and the feasibility ratio are the most critical parameters affecting the model computational performance. For large-sized problems, a heuristic procedure is proposed to generate near optimal production schedules in reasonable computational times. Finally, the illustration of the proposed integrated model with a real case study demonstrated the cost advantage of implementing cyclic production schedules under closed-loop supply chain policy versus cyclic production schedules under manufacturing only policy.