Solution algorithms for dynamic lot-sizing in remanufacturing systems

We consider the problem of determining the lot sizes that satisfy the demands of remanufactured products over a given planning horizon with discrete time periods. Remanufacturing, in which used or end-of-life products are restored to like-new condition, typically consists of disassembly, reprocessing and reassembly processes, and hence the lot sizes are determined for each of the three processes. The objective is to minimise the sum of setup and inventory holding costs occurring at the three processes. To represent the problem mathematically, we suggest a mixed integer programming model by combining the existing ones for disassembly and assembly systems. After proving that the problem is NP-hard, we suggest two dynamic programming based heuristics, called the aggregation and the decomposition type heuristics in this paper. Computational experiments were done on various test instances, and the results show that the two heuristics give near-optimal solutions in a short amount of computation time. Also, the performances of the heuristics are compared according to different values of problem parameters.