A Closed Loop Supply Chain System with Flexible Manufacturing and Reverse Logistics Operation under Shortages for Deteriorating Items

We presented a closed loop structure with remanufacturing for decaying items. The model is considered for single item with two different quality standards. A mount of product is collected from the user. After collection process, a ratio of the collected items is to be remanufactured. Furthermore, a salvaged option is considered within the structure in study. In practices, remanufactured items are perceived by some customers to be of lower quality than newly produced items hence sold in a secondary market at a lower price. Due to this assumption shortage is occurring and the excess demand is completely backlogged. To make the study realistic, we consider production and remanufacturing rate as demand and stock dependent. We establish a mathematical model to determine the optimal replenishment cycle. As a result, in this article, Illustrative examples and sensitivity analysis is presented to describe the situation.