Remanufacturing in Closed-Loop Supply Chain(<Special Issue>The Environmental Management and Production Systems in the 21th Century)

Abstract

Japan has undergone a long period of economic growth based on mass production, mass consumption, and mass disposal. As a result, Japan is facing environmental problem, such as resource constraints and depletion of mineral resources. A lot of companies tend to carry out remanufacturing systems due to these issues. As a result reusing products or parts of it is an important business strategy. In this paper, we review the papers concerning remanufacturing in Closed-Loop Supply Chain and give the definition of "reuse", "refurbishing" and "remanufacturing". Next, we discuss the optimal ordering policy of parts in a Closed-Loop Supply Chain. The manufacturer in the supply chain decides the order quantity of new and reused parts minimizing their total cost. The total cost of manufacturer includes ordering cost of parts, holding cost of products and opportunity loss cost. As a case study, we apply our proposal policy to a product of a certain corporation and confirm the efficiency of the proposal.