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Inventory Management of Remanufacturable Products

Author

Listed:
  • L. Beril Toktay

    (Technology Management, INSEAD, 77305 Fontainebleau, France)

  • Lawrence M. Wein

    (Sloan School of Management, Massachusetts Institute of Technology, Cambridge; Massachusetts 02139)

  • Stefanos A. Zenios

    (Graduate School of Business, Stanford University, Stanford, California 94305)

Abstract

We address the procurement of new components for recyclable products in the context of Kodak's single-use camera. The objective is to find an ordering policy that minimizes the total expected procurement, inventory holding, and lost sales cost. Distinguishing characteristics of the system are the uncertainty and unobservability associated with return flows of used cameras. We model the system as a closed queueing network, develop a heuristic procedure for adaptive estimation and control, and illustrate our methods with disguised data from Kodak. Using this framework, we investigate the effects of various system characteristics such as informational structure, procurement delay, demand rate, and length of the product's life cycle.

Suggested Citation

  • L. Beril Toktay & Lawrence M. Wein & Stefanos A. Zenios, 2000. "Inventory Management of Remanufacturable Products," Management Science, INFORMS, vol. 46(11), pages 1412-1426, November.
    • Handle: RePEc:inm:ormnsc:v:46:y:2000:i:11:p:1412-1426
    DOI: 10.1287/mnsc.46.11.1412.12082
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    References listed on IDEAS

    as
    1. Martin A. Lariviere & Evan L. Porteus, 1999. "Stalking Information: Bayesian Inventory Management with Unobserved Lost Sales," Management Science, INFORMS, vol. 45(3), pages 346-363, March.
    2. James R. Jackson, 1963. "Jobshop-Like Queueing Systems," Management Science, INFORMS, vol. 10(1), pages 131-142, October.
    3. Rodrigo Rubio & Lawrence M. Wein, 1996. "Setting Base Stock Levels Using Product-Form Queueing Networks," Management Science, INFORMS, vol. 42(2), pages 259-268, February.
    Full references (including those not matched with items on IDEAS)

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