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Defective item inventory model with remanufacturing or replenishing in an integrated supply chain

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  • Chi-Chung Lin
  • Chun-Wei Lin

Abstract

In this study, we derive a coordination mechanism for three cases of manufacturer and buyer integration and one case of green supply chain management for a single product. We consider the case of defective items that have been inspected by a buyer, taking into consideration batch processing and product replenishment, in order to satisfy the buyer's demands. A centralised system is designed to minimise the total variable cost per unit time. We then develop theorems to determine the optimal ordering policies and provide bounds to obtain the optimal number of deliveries in order to develop an algorithm. Numerical examples reveal our optimisation procedure to be effective. We also find that the adoption of integrated strategies can result in a lower joint cost compared to the adoption of a stand-alone strategy. Cost saving due to coordination is shared as a result of agreement between all involved parties.

Suggested Citation

  • Chi-Chung Lin & Chun-Wei Lin, 2011. "Defective item inventory model with remanufacturing or replenishing in an integrated supply chain," International Journal of Integrated Supply Management, Inderscience Enterprises Ltd, vol. 6(3/4), pages 254-269.
    • Handle: RePEc:ids:ijisma:v:6:y:2011:i:3/4:p:254-269
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    Cited by:

    1. Tseng-Fung Ho & Chi-Chung Lin & Chih-Ling Lin, 2020. "Determining the Optimal Inventory and Number of Shipments for a Two-Resource Supply Chain with Correlated Demands and Remanufacturing Products Allowing Backorder," Mathematics, MDPI, vol. 8(4), pages 1-16, April.
    2. Katherinne Salas-Navarro & Paula Serrano-Pájaro & Holman Ospina-Mateus & Ronald Zamora-Musa, 2022. "Inventory Models in a Sustainable Supply Chain: A Bibliometric Analysis," Sustainability, MDPI, vol. 14(10), pages 1-21, May.

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