Imperfect production system with rework of regular production with sales returns by customers and buffer stock

Jamal et al. (2004) proposed a model, which dealt with the optimum batch quantity in a single-stage system in which rework is done by addressing two different operational policies to minimise the total system cost but their models do not considered sales return by customers. A portion of defective items produced are not successfully screened out internally during the production process and passed on to customers, thereby causing defect sales returns and reverse logistic from customers back to the manufacturer. In this direction, this paper develops an economic production quantity inventory model with sales return by customers for determining the economic production quantity for a single product, which is manufactured in a single-stage manufacturing system that generates imperfect quality products and all these defective products are reworked in the same cycle. Mathematical model is developed and the optimal production lot size which minimises the total cost is derived.