Pricing and inventory control decisions in the stochastic hybrid production systems with multiple recovery options

Although pricing and inventory control are crucial decisions in each production system, these usually investigated separately. This paper considers simultaneously a hybrid system. The system has two recovery options, remanufacturing refurbishing sites. demand follows Poisson distribution, which depends on the sale price of product. Returned products arrive according to process. Each returned product can be remanufactured, refurbished, or disposed. time manufacturing, refurbishing, also an exponential distribution. By modeling as Markov chain, long-run expected profit function is obtained terms dispose-down-to level order-up-to serviceable products. A three-dimensional state space Chain dependent developed considering with Since model mixed integer nonlinear programming known complex models, Artificial Bee Colony (ABC) algorithm, simulation complete search method used solve problem. results show that by increasing purchase products, amount will increase. If cost high disposal low, less should kept lost high, more maintained. Moreover, decreasing elasticity demand, customer’s increases, then maintained