Optimal control of production and remanufacturing in a simple recovery model with linear cost functions

One aspect in reverse logistics concerns returns of used products and recovery for another life cycle. Remanufactured parts can be used for assembly of new products or the entire (upgraded) product can be sold again. Limitations and enormous waste disposal cost, the duty for manufacturers to take back used products from customers, and the fact that returned products can be regarded as a resource for material requirements are reasons for a consideration of product recovery. In this paper, we present an optimal control approach to optimize the production, remanufacturing, and disposal strategy with respect to dynamic demand and returns.