Abstract
Growing awareness of environmental issues is prompting the development of sustainable supply chain management. Closed-loop supply chains in which used products can be returned for remanufacture are becoming increasingly popular. This paper introduces a two-phase approach to the design of supply chain networks taking into account carbon emission and remanufacturing. In the first phase, a continuous approximation model is used to design the forward supply chain network. The objective is to minimize the total forward network cost by simultaneously determining the number and the service areas of distribution centers (DCs) and the replenishment cycle time for DCs. A nonlinear optimization technique is used to solve the forward supply chain network design problem. In the second phase, a reverse supply chain network is formulated based on the results of the first phase to determine the optimal number and service areas of remanufacturing centers (RCs) and the replenishment cycle time for RCs. Finally, numerical analyses are conducted to show the solution approach and provide some managerial insights.
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