Abstract
In this paper, a two-stage stochastic programming modelling is proposed, to design a multi-period, multistage, and single-commodity integrated forward/reverse logistics network design problem under uncertainty. The problem involved both strategic and tactical decision levels. The first stage dealt with strategic decisions, which are the number, capacity, and location of forward and reverse facilities. In the second stage, tactical decisions, such as base stock level as an inventory policy, were determined. The generic introduced model consisted of suppliers, manufactures, and distribution centers in forward logistic and collection centers, remanufactures, redistribution, and disposal centers in reverse logistic. The strength of the proposed model is its applicability to various industries. The problem was formulated as a mixed-integer linear programming model and was solved by using Benders’ Decomposition (BD) approach. In order to accelerate the Benders’ decomposition, a number of valid inequalities were added to the master problem. The proposed accelerated BD was evaluated through small-, medium-, and large-sized test problems. Numerical results confirmed that the proposed solution algorithm improved the convergence of BD lower bound and the upper bound, enabling to reach an acceptable optimality gap in a convenient time.
Highlights
The main purpose of supply chain management (SCM) is to integrate entities including suppliers, manufacturers, distribution centers, and retailers, in order to acquire raw materials, transform raw materials to finished products, and distribute products to customers in an efficient way [1]
The solution algorithm was implemented in GAMS 23.5
We proposed a generic multi-stage, multi-period, single commodity and capacitated Integrated Forward/Reverse Logistic Network (IFRLN) design that considers both strategic and tactical decisions in one platform
Summary
The main purpose of supply chain management (SCM) is to integrate entities including suppliers, manufacturers, distribution centers, and retailers, in order to acquire raw materials, transform raw materials to finished products, and distribute products to customers in an efficient way [1]. The true value of the closed-loop supply chain networks can be fully gained, only if all aspects of a CLSC are optimized in a coordinated way For this purpose, in this paper an integrated forward/reverse logistic network will be introduced where, in the forward direction, the raw materials for the manufactures are gained from different suppliers, i.e., whole sale contract, spot market, and recycled material. The major contribution of this research is an integrated forward/reverse logistic network design, amenable for forward and reverse flow, so that medium-term and long-term decisions are made simultaneously Two of such tactical (medium-term) decisions are: (1) An inventory policy for distribution centers, considering new, returned, and refurbished products.
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