Closed-Loop Supply Chain Stability under Different Production-Inventory Policies

Product returns from market to the manufacturer can happen because of the motivation to capture the value content of the product after use or the obligation from legislation and the environmental concerns. A manufacturing system capable of integrating both the manufacturing and remanufacturing activities can help the recovery of value content in the products after the end of product’s use life. Ordering policy designed for a production system with unidirectional flow of materials (i.e., up stream to down stream only), when applied to such an integrated system involving manufacturing remanufacturing can create dynamics in the system. Our investigation into this problem has revealed that these dynamics can be avoided if a well defined productionordering rule that explicitly account for the returned products, is adopted. We do the analysis by modifying the well known automatic pipeline inventory and order based production control system (APVIOBPCS) to achieve this goal.