Inventory Management of Remanufacturable Products

L. Beril Toktay (), Lawrence M. Wein () and Stefanos A. Zenios ()
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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

Management Science, 2000, vol. 46, issue 11, 1412-1426

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.

Keywords: closed queueing networks; production control; em algorithms; distributed lag model (search for similar items in EconPapers)
Date: 2000
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Citations: View citations in EconPapers (89)

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