Managing a closed-loop supply chain inventory system with learning effects Free

In this paper, we propose a closed-loop supply chain model consisting of a retailer and a manufacturer. We intend to investigate the impact of learning in regular production, remanufacturing and reworking. The customer demand is assumed deterministic and will be satisfied from both regular production and remanufacturing process. The return rate of used items depends on quality. We propose a mathematical model with the objective is to maximize the joint total profit by simultaneously determining the length of ordering cycle for the retailer and the number of regular production and remanufacturing cycle. The algorithm is suggested for finding the optimal solution. A numerical example is presented to illustrate the application of using a proposed model. The results show that the integrated model performs better in reducing total cost compared to the independent model. The total cost is most affected by the changes in the values of unit production cost and acceptable quality level. In addition, the changes in the defective items proportion and the fraction of holding costs significantly influence the retailer’s ordering period.