An integrated production and inventory model for a whole manufacturing supply chain involving reverse logistics with finite horizon period

This paper proposes a model and solution method for coordinating integrated production and inventory cycles in a whole manufacturing supply chain involving reverse logistics for multiple items with finite horizon period. A whole manufacturing supply chain involving reverse logistic consists of tier-2 suppliers supplying raw materials to tier-1 suppliers, tier-1 suppliers producing parts, a manufacturer which manufactures and assembles parts from tier-1 suppliers into finished products, distributors distributing finished products to retailers, retailers selling products to end customers and a third party which collects the used finished products from end customers, dissembles collected products into parts, and feed the parts back to the supply chain. In this system, we consider a finite horizon period. A mathematical model for representing the behaviors of the system is developed. Solution methods based on decentralized and a combination of decentralized and centralized decision making process, referred to as the semi-centralized decision making process, are proposed to solve the model while the centralized decision making process is solved by a mixed integer nonlinear programming method. A numerical example is used to demonstrate the model and the solutions based on the three types of the coordination.

[1]  S. Goyal,et al.  Coordinating a three-level supply chain with multiple suppliers, a vendor and multiple buyers , 2008 .

[2]  Brian G. Kingsman,et al.  Coordination in a single-vendor multi-buyer supply chain by synchronizing delivery and production cycles , 2007 .

[3]  Kazuyoshi Ishii,et al.  A production ordering system for two-item, two-stage, capacity-constraint production and inventory model , 1996 .

[4]  Mohammed Ben‐Daya,et al.  An integrated production inventory model with raw material replenishment considerations in a three layer supply chain , 2013 .

[5]  Subrata Mitra,et al.  Analysis of a two-echelon inventory system with returns , 2009 .

[6]  H. Wee,et al.  Optimal replenishment policy for a deteriorating green product: Life cycle costing analysis , 2011 .

[7]  Hsiao-Fan Wang,et al.  A closed-loop logistic model with a spanning-tree based genetic algorithm , 2010, Comput. Oper. Res..

[8]  Zhimin Huang,et al.  A joint inventory model for an open-loop reverse supply chain , 2008 .

[9]  R. Teunter.  Economic ordering quantities for recoverable item inventory systems , 2001 .

[10]  M. Khouja.  Optimizing inventory decisions in a multi-stage multi-customer supply chain , 2003 .

[11]  Hui-Ming Wee,et al.  Green-product-design value and information-technology investment on replenishment model with remanufacturing , 2010, Int. J. Comput. Integr. Manuf..

[12]  R. Ganeshan.  Managing supply chain inventories: A multiple retailer, one warehouse, multiple supplier model , 1999 .

[13]  Hui-Ming Wee,et al.  Optimal policy for a closed-loop supply chain inventory system with remanufacturing , 2008, Math. Comput. Model..

[14]  Hark Hwang,et al.  An optimal ordering and recovery policy for reusable items , 2002 .

[15]  Wenyih Lee.  A joint economic lot size model for raw material ordering, manufacturing setup, and finished goods delivering , 2005 .

[16]  Samir K. Srivastava,et al.  Green Supply-Chain Management: A State-of-the-Art Literature Review , 2007 .

[17]  Tsung-Hui Chen,et al.  Optimizing Supply Chain Collaboration Based on Joint Replenishment and Channel Coordination , 2005 .

[18]  Mohamad Y. Jaber,et al.  A production/remanufacture model with returns’ subassemblies managed differently , 2011 .

[19]  Neslihan Demirel,et al.  A mixed integer programming model for remanufacturing in reverse logistics environment , 2008 .

[20]  David Z. Zhang,et al.  Agent-based model for optimising supply-chain configurations , 2008 .

[21]  Cengiz Haksever,et al.  A model for optimizing multi-product inventory systems with multiple constraints , 2005 .

[22]  Luk N. Van Wassenhove,et al.  Closed - Loop Supply Chain Models with Product Remanufacturing , 2004, Manag. Sci..

[23]  Sarada Prasad Sarmah,et al.  Buyer vendor coordination models in supply chain management , 2006, Eur. J. Oper. Res..

[24]  José A. Ventura,et al.  Optimal inventory policies with two modes of freight transportation , 2008, Eur. J. Oper. Res..

[25]  Hui-Ming Wee,et al.  Short life-cycle deteriorating product remanufacturing in a green supply chain inventory control system , 2011 .

[26]  Hark Hwang,et al.  A generalized ordering and recovery policy for reusable items , 2007, Eur. J. Oper. Res..

[27]  Chi Kin Chan,et al.  A delayed payment method in co-ordinating a single-vendor multi-buyer supply chain , 2010 .

[28]  M. J. Rosenblatt,et al.  Coordinating a three-level supply chain with quantity discounts , 2001 .