Abstract
This paper derives a reverse logistic inventory model with imperfect production, stock-dependent demand, flexible manufacturing, and shortages over infinite planning horizon. The objective is to determine the joint policy for optimal production, amount of remanufacturing, collection of reusable items, and collection as well as disposal of defective items which minimizes the total cost of the inventory system under consideration. To make the model more realistic, both of the cases of linear and nonlinear holding costs have been discussed. The results are discussed with a numerical example to illustrate the theory.
Highlights
The assumption of perfect production is not ideal for practical production system
We have presented computational results obtained by using Mathematica 7.0 which give insight about the behavior of optimal run size Q∗, production cycle time T, and the effects of reverse manufacturing on the total average cost TAC
(iii) As β decreases, total average cost slightly increases and cycle length T increases. This model addresses the various expected realistic features that usually arise while working on the optimal production policy that minimizes the associated inventory cost
Summary
The assumption of perfect production is not ideal for practical production system. Even the best production system may produce defective items. The governmental guidelines clearly state reduction of wastages, conservation of precious resources, protection of environment, and prevention of environmental degradation as a guiding principles for the business organizations. The manufacturing organizations may reuse the defective items after suitably repairing and removal of defects in order to avoid waste of resources. The defective items which are either irreparable or cannot be repaired and cost effectively are disposed off. They prefer to reuse or recycle the items procured from the customers and reconvert through the appropriate process to appear as new and useful
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