Lot-sizing for a single-product recovery system with backordering

In this article, a single-product recovery system is studied. Used products are collected from customers and kept at the recoverable inventory warehouse for future recovery. The constant demand rate can be satisfied either by newly produced products or by recovered ones (serviceable inventory), which are regarded as perfectly as the new ones. Excess demand is completely backordered. Following an exact analytical approach, the optimal production and recovery policy is obtained. A numerical cost comparison of this model with the corresponding one without backordering is also performed. The results are general, as they were valid for finite and infinite production and recovery rates.