Modeling and optimizing the operation process of manufacturing system in reverse logistics environment

The operation process for a class of manufacturing system in reverse logistics environment is considered. A manufacturing system is designed based on an existing framework for remanufacturing system. In this system, according to retailer / customer´s demands, the manufacturer has two alternatives for manufacturing: either ordering the required parts to external suppliers or overhauling returned products and bringing them back to ´as new´ conditions. An operating model is constructed to maximize the total profits by optimally deciding the number of purchased parts from external suppliers or subcontractor, the quantity of parts to be processed at each remanufacturing facilities. The model is validated through a set of experimental data reflecting practical business situation and sensitivity analyses are conducted on various parameters to gain insight into the proposed model.