Analysis of a product recovery system

The continuous growth in consumer waste in recent years has seriously threatened the environment. Environmentally conscious manufacturing and product recovery has become an obligation to the environment and to society. Many countries are contemplating regulations that force manufacturers to take back used products from consumers so that the components and materials retrieved from the products may be reused and/or recycled. We focus on a product recovery system in a remanufacturing system. Product recovery aims to minimize the amount of waste sent to landfills by recovering materials and parts from old or outdated products by means of recycling and remanufacturing. It should be considered when designing and managing the manufacturing systems. We propose a new analytical approach to evaluating the product recovery system with stochastic variability. This model applies the traditional inventory theory to the production/inventory management with consideration for disposal and return. The system is formulated by a discrete time Markov chain. It is composed of the states denoted by the number of the inventory, the transition probabilites between states and the costs associated with the transitions. Using the Markov analysis, we can calculate the total expected average cost per period exactly. Numerical examples are given to show the property of the management system and optimize the product recovery system.