Journal of Korean Institute of Industrial Engineers (대한산업공학회지)

Korean Institute of Industrial Engineers (대한산업공학회)
권호 표지

Joint Decision of Optimal Procurement Policy and Optimal Order ize for a Product Recovery System

회수제품 재가공이 이루어지는 시스템에서 최적 신제품 구매정책과 최적 주문량에 대한 연구

  • Kim, Eungab (College of Business Administration, Ewha Womans University) ;
  • Jeong, Bongju (Department of Information and Industrial Engineering, Yonsei University)
  • 김은갑 (이화여자대학교 경영대학) ;
  • 정봉주 (연세대학교 정보산업공학과)
  • Received : 2007.10.31
  • Accepted : 2008.06.30
  • Published : 2008.12.31
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Abstract

We consider a product recovery system that a single product is stocked in order to meet a demand from customers who may return products after usage. This paper addresses a problem of when to release a procurement process to replenish serviceable inventory and how many new products to procure. The structure of the optimal procurement policy is examined and numerically identified as a monotonic threshold curve. A numerical procedure is presented to jointly find the optimal procurement order size, optimal procurement policy, and optimal discounted profit. Sensitivity analysis also indicates that these optimal performance measurements have monotonic properties with respect to system parameters.

Keywords

Acknowledgement

Supported by : Korea Research Foundation

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