This paper considers a modular product assembly and inventory planning and control problem in a remanufacturing environment. The return process of end-of-life product is a stochastic process in terms of arriving time, quality and quantity. We investigate the returned module reassembly policies in an assemble-to-order strategy. A threshold policy is considered to control the admission of the product returns and its effect on the trade-off between excessive inventory and stock out. We study how the control parameters in these strategies relate to the average inventory level and stock out level of the remanufacturable modules. Starting with a single quality grade problem, we extend the analysis to a multiple quality grade problem and derive exact expression of the system performance measures as function of the control parameters. Main objective of this paper is to provide managerial insights into decision-making for stochastic remanufacturing systems.

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