Joint ordering and reuse policy for reusable items inventory management

This paper proposes two optimal models for determining order quantity for reusable items. In most of traditional manufacturing models, it is assumed that the items can be utilized just one times, and then should be disposed. However, in today competitive markets, the limited availability of natural resources, environmental consciousness and government regulations have motivated many companies to start recovery and reusing activities. In these cases, utilizing recovery processes can reduce the need for new materials and leads to considerable cost savings. Some examples are the systems for machine tools, medical and surgical instruments, copiers, automobile parts, and office furniture. In our models, after that a new item is purchased and used, it is checked to evaluate whether the useful life amortizes. If yes, the item is disposed, and otherwise, it will be recovered and reused. The reused item is again recovered for reusing, if its useful life is not still amortized. This process is repeated till end of useful life. The aim is to determine the economic order quantity for new items (ordering policy) as well as batch quantity for recovery and reusing process (reuse policy), so as to minimize the total cost of inventory system. By utilizing different holding costs for usable and used items, two inventory model are developed. Numerical examples are presented and discussed, and then, an analysis of sensitivity is carried out to assess the sensitivity of results to parameters.