A simulation model to justify remanufacturing policies

To maintain a high level of service Original Equipment Manufacturers (OEMs) provide more generous return policies for their products. However, discarding returned parts is neither economical nor environmentally desirable. As a result there is a great need for policies on remanufacturing aftermarket products from returned units. Two of the factors that affect justification of setting up after-market reproduction runs are the flow rate and composition of good returned parts. These factors are stochastic functions of the production rate for the primary product and the reliability of individual subassemblies. A closed form solution for estimating these variables is often difficult to develop. This paper presents a general formulation for simulation modeling of such remanufacturing systems and estimation of the flow rate and composition of good returned parts.