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Assessing the benefits of remanufacturing option under one-way substitution

Author

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  • Z P Bayındır

    (Erasmus University Rotterdam)

  • N Erkip

    (Middle East Technical University)

  • R Güllü

    (Middle East Technical University)

Abstract

In this study, we consider a segmented market for a product that can either be manufactured or remanufactured. It is assumed that the remanufactured products can be substituted by the new ones. A steady-state profit model is constructed under certain environmental assumptions on capacity requirements of operations, and revenue and cost schemes. Exact steady-state probabilities of the Markovian model constructed are solved via matrix geometric techniques. An extensive computational study is performed to investigate the conditions under which the utilization of remanufacturing option and the use of one-way substitution policy increase the average expected profit.

Suggested Citation

  • Z P Bayındır & N Erkip & R Güllü, 2005. "Assessing the benefits of remanufacturing option under one-way substitution," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 56(3), pages 286-296, March.
    • Handle: RePEc:pal:jorsoc:v:56:y:2005:i:3:d:10.1057_palgrave.jors.2601799
    DOI: 10.1057/palgrave.jors.2601799
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    References listed on IDEAS

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    Cited by:

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    3. Deflem, Yannick & Van Nieuwenhuyse, Inneke, 2013. "Managing inventories with one-way substitution: A newsvendor analysis," European Journal of Operational Research, Elsevier, vol. 228(3), pages 484-493.
    4. Ghosh, Debabrata & Gouda, Sirish & Shankar, Ravi & Swami, Sanjeev & Thomas, Vinu Cheruvil, 2018. "Strategic decision making under subscription-based contracts for remanufacturing," International Journal of Production Economics, Elsevier, vol. 200(C), pages 134-150.
    5. Chen, Jen-Ming & Chang, Chia-I, 2012. "The co-opetitive strategy of a closed-loop supply chain with remanufacturing," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 48(2), pages 387-400.
    6. Ahmed Senoussi & Youcef Boutarfa & Nadjib Brahimi & Tarik Aouam, 2024. "Sustainable Hybrid Manufacturing and Refurbishing Systems with Substitution," Sustainability, MDPI, vol. 16(17), pages 1-33, August.
    7. Liu, Baolong & Papier, Felix, 2022. "Remanufacturing of multi-component systems with product substitution," European Journal of Operational Research, Elsevier, vol. 301(3), pages 896-911.
    8. Piñeyro, Pedro & Viera, Omar, 2010. "The economic lot-sizing problem with remanufacturing and one-way substitution," International Journal of Production Economics, Elsevier, vol. 124(2), pages 482-488, April.

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