Essays on supply chain management
This dissertation addresses three important problems with the shared objective of increasing the efficiency of supply chains. The first one considers a forward distribution network. The other two deal with the reverse flow of product in remanufacturing environments. The dissertation is divided accordingly into three well differentiated parts.
The first part considers a multistage inventory system composed of a single warehouse that receives a single product from a single supplier and replenishes the inventory of n retailers through direct shipments in Full-Truckload transportation mode. Based on the structural properties of optimal solutions derived, we develop an exact algorithm that runs in polynomial time for a given number of retailers. To overcome the computational burden when the number of retailers is large, we propose two additional algorithms based on Lagrangian decomposition. Computational experiments show the effectiveness of the algorithms and the gains associated with coordinated versus decentralized systems.
The second part of the dissertation considers the joint production, procurement and inventory control problem for an assembly system where one of the two components in the end product is produced through remanufacturing. By acquiring additional information on the quality of returned products, the firm can adopt a more selective recovery process to reduce the uncertainty in the remanufacturing yield. We show that the optimal recovery lot size first increases, then decreases as more information is acquired in a special case and the convexity of the expected total cost in the recovery lot size in a slightly more general model.
The third part of the dissertation investigates the profitability of remanufactured products for a monopoly firm in a single period setting. The firm has to decide (1) whether to offer both new and remanufactured products or to offer only new products to the market, (2) whether to offer some new products as substitutes to remanufactured products. We characterize a threshold for the remanufacturing cost under which offering remanufacturing products is profitable, and a threshold for the production cost of new products which is a necessary condition for the substitution option to be profitable.
0796: Operations research