An Investigation on Capacity Planning and Lead Times for Remanufacturing Systems Using System Dynamics

In this paper, our focus is the study of remanufacturing activity, which is one of the main recovery methods applied in closed loop supply chains. In particular, we model a production and inventory system for remanufacturing using a System Dynamics simulation modelling approach. The aim is to explore the dynamics of the remanufacturing process and to evaluate system improvement strategies. Specifically, the analysis focuses on the effects of capacity planning and lead times on the system which presents push and pull inventory policies driven mainly by the inventory coverage. The research findings reveal efficiency in the remanufacturing process with higher remanufacturing capacity if the quantity of remanufacturable returns and the remanufacturing lead time are increased and decreased, respectively. Moreover, an increase in the production lead time has a higher effect on system performance than an equivalent increase in the remanufacturing lead time.