Production, remanufacture, and waste disposal model for third party and manufacturer with the case of backordering and overlapping cycle

Production process in many companies involves not only producers and consumers but also suppliers, collectors, and manufacturers as its stakeholder. Some defect products are often out of inspection so that it has been distributed along the markets and soon rejected by the customers. The role of collectors is to buy the rejected products from customers and resell them to manufacturers for recycling. However, rejected products are not always suitable for further recycling. Collectors should have separated whether the products are repairable or not in advance. Manufacturers will only use the repairable ones to produce remanufactured products and purchase materials from suppliers for producing newly-manufactured-items. Those two types of products from manufacturers are perceived incompatible by customers. This case may causes overlapping cycle when newly-manufactured-items are requested in remanufacturing cycle, and vice versa. Thus, backorder or lost sales occurs in this situation. This paper extends inventory condition for the firm having roles as collector, manufacturer, and remanufacturers at a time, while the manufacture and remanufacture cycles are experiencing backorder and overlapping cycle. The calculations prove that total cost of the firms having role as manufacturer, collector, and remanufacturer is higher than those doing the manufacture and remanufacture process. They also get the advantages of selecting rejected products to be remanufactured so that the quality of the remanufacturer products can be increased.