Inventory Decision-making Models For A Closed-loop Supply Chain System

With the economic development of China,an enormous phenomenon of waste has occurred especially in the production.In order to against this, construction of CPC Central Committee and State Council put forward the idea of saving society, calling for nationals in the production, circulation, consumption and other fields, through the adoption of legal, economic and administrativecomprehensive measures to improve the efficiency of resource use, with minimal consumption of resources to maximize the economic and social benefits, ensure economic and social sustainable development of society. Significant based on this strategy, we have the traditional "producer-consumer" forward on the basis of the logistics supply chain, add a product recovery, reverse logistics, namely "consumer-producer"; the traditional one-way supply chain can be recycled into a closed ring, so that recyclable back old products for re-manufacturers at manufacturing, to achieve the conservation of resources, the purpose of reducing costs, which also "green, low carbon" concept is consistent.Then the closed-loop supply chain system is investigated in this study. This system consists of a retailer, a manufacturer, a supplier, and a collector. The demand of the retailer is satisfied either by newly manufactured products or by remanufactured products which are comparable to the new ones in function and quality. This research focus is on the closed-loop supply chain, all participants should take their profits and inventory system of decision-making to maximize profits, and the entire system play a critical role in decision-making but the manufacturer's decision problem:In a model cycle, he should set the number of manufacturing cycles and re-manufacturing cycle and how to arrange them in the process, he should choose what kind of material, old products and product inventory policy. Decision makers not only affect his own cost and profit, while profits of other participants or profits of the system plays an important role.We must apply one manufacturing cycle and at least one remanufacturing cycle policy (i.e. the (1,R)policy),or at least one manufacturing cycle and one remanufacturing cycle policy(i.e. the (P,1)policy) to the manufacturer's manufacturing and remanufacturing operations in the research, and give the corresponding procedures to determine the optimal system policy in the completely decentralised decision-making case and the completely centralised decision-making case by elimination theory and the difference function. The results are general since the manufacturer tends to adopt one manufacturing cycle and at least one remanufacturing cycle policy(i.e. the (1,R)policy) when the return rate is higher; otherwise, the manufacturer tends to adopt at least one manufacturing cycle and one remanufacturing cycle policy(i.e. the (P,1)policy).Additionally, taking into account the type of decision-making, the paper will be divided in the model solution process to discuss the two extreme cases:completely decentralized decision-making (as CD for short) and completely centralised decision-making (as CC for short).