Multiproduct Economic Lot Scheduling Problem with Returns and Sorting Line

This work studies a hybrid manufacturing–remanufacturing system with a sorting line and disposal. In particular, it models a company that collects used product, remanufactures returned products that have been evaluated as suitable to be recovered, and manufactures new products to satisfy customer demand. Specifically, the system is modeled as a multilevel inventory system, with three types of stock (used products inventory, recoverable inventory, and serviceable inventory), each characterized by an inventory holding cost, and three limited capacity resources: a sorting line, which enables the company to distinguish those returns that are remanufacturable from those that are not; a remanufacturing line to carry out operations on sorted remanufacturable returns; and a manufacturing line to produce new products in order to satisfy customer demand. Each resource is characterized by a setup cost, as well as a constant production rate, while each type of stock is associated with an inventory holding cost. The aim of the paper is to develop a model for the considered production system in order to minimize the setup and inventory holding costs. In particular, the objective is to evaluate the behavior of a controllable disposal rate with the minimization of the total cost function, by considering the effect on the remanufacturing and manufacturing lines.