APIEMS2009
Dec. 14-16, Kitakyushu
A Manufacturing/Remanufacturing System with the Consideration of Required Quality of Recycled Products Jianquan Guo† 1,2 and Youngdae Ko2 1
Business School, Shanghai University For Science and Technology, No.516 Jungong Road, Shanghai, CHINA, 200093 Email:
[email protected] Youngdae Ko
2
Department of Industrial and Systems Engineering, Korea Advanced Institute of Science and Technology, Daejeon, 305-701, KOREA Email:
[email protected] Hark Hwang2
2
Department of Industrial and Systems Engineering, Korea Advanced Institute of Science and Technology, Daejeon, 305-701, KOREA Email address:
[email protected]
Abstract. This paper deals with a manufacturing/remanufacturing system. A constant demand is satisfied by remanufacturing recycled products as well as new manufactured products. It is assumed that return rate, unit buyback cost and remanufacturing cost are affected by the quality level of returned products. For remanufacturing, only the used products that satisfy a required minimum quality level will be collected. Treating the quality level of recycled products, the length of a cycle, the number of manufacturing lots and remanufacturing lots in a cycle as decision variables, we develop the mathematical models with the objective of minimizing the average total cost. Tabu Search algorithm is proposed to find the solution. Keywords: Buyback cost, Manufacturing/remanufacturing system, Quality level, Remanufacturing cost, Return rate
1. Introduction Nowadays, remanufacturing activity has been viewed not simply as a cost of doing business, but as a profitable business model and source of competitive advantage [9]. However, there exist differences between remanufacturing and manufacturing system. The major difference involves the supply side. For a remanufacturing system, supply is largely exogenous, and the timing, quantity, and quality of supply are much more uncertain than in traditional production distribution systems [1, 8]. This study focuses mainly on the variable quality of returned products. Generally, quality level of recycled products is uncertain and will affect remanufacturing cost and yield. If the quality is very low, remanufacturing process will be complex, the quantity of certain input material (e.g., chemical pulp in newspaper manufacturing industry) should be more than normal, and/or the output might not be assured. Since a reverse logistic model (deterministic EOQ-type model) was first analyzed by Schrady[2], many studies have acknowledged the problem of variable supply quality for remanufacturing systems[3, 5, and 10]. In this research, a manufacturing/remanufacturing system is investigated with the consideration of required minimum quality of recycled products where a constant demand is satisfied by remanufacturing and manufacturing process. It is assumed that return rate, buyback cost and remanufacturing cost are dependent on different quality level of returned products. For remanufacturing, only the used products that satisfy a required minimum quality level will be recycled. In contrast to the above literature, we take return rate, unit buyback cost and remanufacturing cost to be all unknown; and explore its generalized model.
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APIEMS2009
Dec. 14-16, Kitakyushu
2. Notations and assumptions To model the manufacturing/remanufacturing system, the following notations and assumptions are introduced. 2.1 Notations Decision variables: q: The required minimum quality level of returned products, 0≤ q ≤1; T: Length of a cycle [time]; m: Number of remanufacturing lots, positive integer; n: Number of manufacturing lots, positive integer. Parameters: a: Parameter of the buyback cost function, 0≤a≤1. θ: Parameter of the buyback cost function. b: Parameter of the return rate function, 0≤b≤1. φ: Parameter of the return rate function. c: Parameter of the remanufacturing cost function, 0≤c≤1. δ: Parameter of the remanufacturing cost function. hS: Holding cost per unit per unit time of serviceable stock, [$]/[unit][time]. hR: Holding cost per unit per unit time of returned stock, [$]/[unit][time]. hraw: Holding cost per unit per unit time of raw material stock, [$]/[unit][time]. CM: Manufacturing cost per unit, [$]/[unit]. D: Demand rate, [unit]/[time]. (1/β)D: Manufacturing rate (0
