An optimal ordering and recovery policy for reusable items

Abstract

This paper deals with a joint ECQ and EPQ model in which the stationary demand can be satisfied by recycled products and newly purchased products. The model assumes that a fixed proportion of the used products are collected from customers and later recovered for reuse. The recovered products are regarded as perfectly new ones. We obtain (i) the economic order quantity for newly procured products and (ii) the optimal inventory level of recoverable items to start the recovery process, simultaneously. According to the relationship between parameters, we propose some numerical models to analyze the system. Then a solution procedure to find the optimal control parameters is presented, and finally some numerical examples are given to illustrate the model. (C) 2002 Elsevier Science Ltd. All rights reserved.