Reverse Supply Chain Research Articles

Reverse Supply Chain for Sustainable Growth Remanufacturing Perspective

Reverse logistics refers to set of all procedures affiliated with reuse of various commodities and its ingredients. This article is predominantly concerned with various principles of reverse logistics, various activities comprehended with remanufacturing process, necessity of reverse logistics in India and various types of flows that reverse logistics deals with. Limited forecasting & planning, inadequate information & technical systems, shortage of pertinent attainment administration entity are the major barriers to reverse logistics system. However due to economic benefits there is a necessity for companies to adequately manage their strategies.

An integrated contract for coordinating a three-stage green forward and reverse supply chain under fairness concerns

Today’s competitive business environment implies the integration of industrial and environmental policies leading to greener supply chains. This paper considers an integrated three-stage forward and reverse supply chain, which provides new and remanufactured green products to a green conscious market. Both the manufacturer and the remanufacturer invest on green manufacturing processes. Our research problem is the coordination of this integrated green supply chain through contracts. We develop an integrated two-part tariff contract so that all supply chain members act rationally according to the centralized solution. Along with its coordination ability, we also develop a mathematical model to determine the contract parameters so that the contract is fair and each supply chain member benefits from the contract almost evenly. The results denote that as the consumers become more sensitive to the greening levels of new and remanufactured products, the manufacturer and the remanufacturer determine higher greening levels; also the demands for both types of green products increase; and the overall supply chain earns more profit. As more green products are sold, collector becomes more sufficient to collect used products from the market, which also increases the remanufacturer’s greening level, the demand for remanufactured products, and the profit of the overall supply chain. Thus, a greening initiative has a positive impact on the others; and this leads to a more successful supply chain both in environmental and economic dimensions.

Evaluating cost impacts on reverse logistics using an Economic Order Quantity (EOQ) model with environmental and social considerations

Societal awareness and legislation changes concerning sustainability have affected how organizations generate value for stakeholders, as well as their processes, products, and public relations. In the context of increasing environmental and social awareness, more studies are needed regarding reverse logistics lot-sizing control taking into account sustainability principles. The contribution of this study is the incorporation of sustainable costs in reverse logistics processes using the Economic Order Quantity (EOQ) model. This paper proposes the extension of a mathematical model for lot-sizing in the reverse logistics that considers environmental, social, and economic parameters. A numerical example and sensitivity analyses are presented to evaluate the sustainable EOQ. Our results indicate that carbon prices have a significant impact on the remanufacturing tax, i.e. the proportion of reusable items in a reverse supply chain that are successfully remanufactured. Additionally, a perspective on the social impact on lot sizing is discussed by noting that high social costs, calculated as a function of ergonomic conditions, can invalidate a high remanufacturing tax. As a consequence, poorly planned labour conditions in reverse logistics can lead to lower recycling rates due to inefficient use of social resources.

Dynamic reverse supply chain network design under uncertainty: mathematical modeling and solution algorithm

AbstractMotivated by the recovery of modular‐structured products, this study addresses the flexible design of a reverse supply chain (RSC) over a planning horizon while incorporating the dynamic uncertain behavior of product returns. The stochastic parameter is modeled as a scenario tree and therefore the concerned problem is formulated as a multistage mixed‐integer stochastic program. To alleviate the computational complexity of the proposed model, it is decomposed into smaller scenario cluster submodels associated with a number of subtrees that share a certain number of predecessor nodes in the original scenario tree. The submodels are coordinated into an implementable solution via a Lagrangian‐progressive hedging‐based method that employs a viable Benders decomposition based algorithm for solving each scenario cluster submodel. Based on a realistic scale case, computational results indicate the superiority of the proposed flexible dynamic RSC design model compared to the existing models. Results also demonstrate the efficiency of the proposed solution approach.

Optimal Interest Rates for Supply Chain Payables Finance

Problem definition: Payables finance, also known as reverse factoring or supply chain finance, is a form of trade finance arrangement that provides a supplier with the option to receive a buyer's payables early while allowing the buyer to extend its payment due date. Its recent adoption of the blockchain technology has made the process more efficient and secure. In this paper, we study the supplier's optimal cash management policy under such a payables finance arrangement, based on which we quantify the value of payables finance to the supplier and also determine the equilibrium payment term extension for the buyer. Academic/Practical Relevance: Our work presents one of the first rigorous analyses of the optimal cash management policy with payables finance by extending the classic cash management models to allow all interest gains and costs to accrue together with the cash balance. Methodology: We develop a finite-horizon random cash management model and transform it into a cash flow cost minimization problem with a dynamic program formulation. Results: Our analysis reveals that the optimal cash policy has a cash balance-dependent (L, M, U) structure, which differs from the threshold policies found in the classic cash management models. We show that it is the cash liquidity enabled by payables finance to hedge cash flow uncertainty that generates value to the supplier. Such value increases with a lower payables finance interest rate and/or a higher payables finance amount. We further show that the equilibrium payment term extension for the buyer increases with a lower payables finance interest rate, but not necessarily with a higher payables finance amount. To tackle the computational challenge of the problem, we show that the myopic policy for this problem has a simple threshold policy structure. For performance evaluation purposes, we also derive an easy-to-compute cost lower bound based on a system with slightly modified cash balances. Our numerical study shows that both the myopic policy and the optimal policy of the modified system achieve near-optimal performance in the original problem. Managerial Implications: Our study provides theoretical support for the wide adoption of payables finance for small suppliers with poor credit ratings and tight cash constraints. Our model analysis also suggests that the adoption of the blockchain technology can offer greater value to such suppliers. The computational methods developed in the paper can be used as a means to evaluate the value of payables finance and the payment term extension, especially in a frictionless blockchain setting.

A review of closed-loop supply chain models

Closed-loop supply chain (CLSC) networks have been studied extensively in the literature due to the cost and environmental optimization in operations. A CLSC consists of forward and reverse supply chains. This paper reviews the literature of CLSC networks. 225 peer-reviewed articles that have been published in international journals from 1997 to 2020 are gathered and analysed. The aim is to answer the following main questions: (i) What is the problem domain in CLSC? (ii) Which techniques are utilized frequently in CLSC? (iii) What elements, variables, and objectives are the main focus in the field? (iv) What are the gaps in the literature? After reviewing the literature, observations are provided. Finally, the evaluations conclude suggested improvements and potential future directions in this research field.

Location of facilities and network design for reverse logistics of lithium-ion batteries in Sweden

Estimations of the amount of lithium-ion batteries reaching their end-of-life in 2025 and the amount being recycled indicates large deviations. To enable an efficient recycling process a well-defined and efficient supply chain network for the recovery of discarded lithium-ion batteries must be put in place. This includes analyzing the needs and restrictions of such a network. The aim of this paper is to provide decision support tools, to analyze input, and optimize a future supply chain for discarded lithium-ion batteries. A mixed integer programming model is developed and applied to the Swedish market. The findings show that several aspects will affect a reverse supply chain for discarded lithium-ion batteries, many of which are still uncertain and hard to predict.

The uncertain two-stage network DEA models

The two-stage network DEA models based on the framework that the efficiency of the whole stage is equal to the product of the efficiencies of two sub-stages can not only turn the ‘black box’ into the ‘glass box’ to identify the root causes of the inefficiency of the network system, but also consider the relationship between the two sub-stages within the whole stage. Nowadays, the two-stage network DEA models have been widely applied in the field of economy and management, such as green supply chain and reverse supply chain. Due to the novelty of evaluation indexes, these emerging research objects with network structure, such as green supply chain, involve not only traditional evaluation indexes such as cost and time, but also some novel evaluation indexes such as customer satisfaction and flexibility. However, these new evaluation indexes are difficult to quantify accurately, which will lead to the failure of the traditional two-stage network DEA models. Therefore, this paper attempts to extend the traditional two-stage network DEA models to the uncertain two-stage network DEA models with the application of uncertainty theory. In the new models, inputs, intermediates and outputs are considered to be uncertain variables to deal with the problem of inaccurate data. Finally, a numerical example of the uncertain two-stage network DEA models will be presented for illustration.

Cyclic manufacturing and remanufacturing in a closed-loop supply chain

The implementation of a cyclic production scheduling approach has been shown to enhance resource utilization and to improve shop floor control. Recently, closed-loop supply chain management has become a topic of strategic importance due to its positive environmental and economic impacts. As a result, many organizations integrated manufacturing and remanufacturing operations to optimize the efficiency of their forward and reverse supply chain processes. The focus of this research is to integrate cyclic production scheduling policies in a two-stage closed-loop supply chain. The problem is formulated as a mixed-integer linear program to generate an optimal cyclic production schedule with no demand shortages that minimizes the sum of holding and setup costs under a given cyclic delivery schedule required by the customer. The results of the sensitivity analysis revealed that the number of products, the product return rate, and the feasibility ratio are the most critical parameters affecting the model computational performance. For large-sized problems, a heuristic procedure is proposed to generate near optimal production schedules in reasonable computational times. Finally, the illustration of the proposed integrated model with a real case study demonstrated the cost advantage of implementing cyclic production schedules under closed-loop supply chain policy versus cyclic production schedules under manufacturing only policy.

Cooking oil and fat waste management: A review of the current state

Waste management is a continuously growing area connecting industry and academia nowadays. There are, however, still many issues and sub-areas requiring in-depth analysis and development of new approaches and solutions. One of them is the management of waste cooking oils and fats originated from households. While most of the solid waste is addressed within the circular economy proposal, the fat waste recycling consideration is still in its early stage, as the relevant European Union legislation has only recently been adopted. Disposing of oil and fat waste in a traditional way often leads to sewage problems. However, if utilised, this waste may be a valuable source of energy and material recovery. While maintaining the reverse supply chain viewpoint (from waste producers through the collection to treatment and utilisation), this paper reviews the current state of the waste cooking oils and fats management and identifies the drawbacks in existing collection and handling methods. The review shows that current approaches have shortcoming mainly due to poorly organised collection container networks and provides insights into the importance of effective prognosis of the cooking oil and fat waste whose collection and handling is still in the development. The Czech Republic current state and the future outlook is discussed and commented with regards to the expected growth of production and separation of these wastes. The review stresses the challenges of establishing and coordinating the supply chain segments, which will benefit from applying mathematical modelling to facilitate decision-making.

Multi-product and multi-period closed loop supply chain network design under take-back legislation

This paper addresses the closed loop supply chain (CLSC) network design problem for durable products with consideration of take-back legislation. Each returned end-of-life product can be dismantled into different components. A recovery option is adopted for each component based on its quality level, its economic value, and its environmental impact. First, a multi-product multi-period mixed integer linear programming (MIP) model is proposed while assuming a 100% recovery target. The latter is then extended in order to incorporate other take-back legislations: namely, regulation based on other recovery targets and regulation based on reward-penalty (RP) mechanisms. Sensitivity analysis is then carried out in order to capture how some model parameters influence the take-back decision, the integration of the reverse supply chain, and its structure when there are no regulatory restrictions on the take-back of returns. In addition, the CLSC performance, in terms of environment and economic efficiency, is investigated under different take-back legislations. For the considered case study, a comparative study shows that a higher reverse service level and CLSC profit can be achieved when a regulation based on RP mechanism is implemented.

Decentralized master production and recycling scheduling of lithium-ion batteries: a techno-economic optimization model

Due to the rapid growth of e-mobility, increasing amounts of lithium-ion batteries are produced and returned after their lifetime. However, these returns will lead to new challenges for manufacturers and recyclers, considering the end-of-life. Especially the increasing interaction between forward and reverse supply chain and the related decision on the end-of-life options (e.g., recycling, remanufacturing, and reuse) need to be planned and executed in a sophisticated way. Therefore, we focus on the interactions between recycler and manufacturer as two of the major actors of each supply chain. We formulate optimization models for the master recycling scheduling and the master production scheduling. To analyze current decentralized decisions of the recycler and remanufacturer, we further formulate an integrated master production and recycling scheduling model. In the following, we describe the production and recycling of lithium-ion batteries in a case study. Here, we examine five different scenarios. We find that for all scenarios, manufacturer and recycler achieve positive contribution margins. However, inefficiencies always occur due to opportunistic behavior. As a result, reuse is performed only in case of centralized planning. Hence, coordination is needed between the forward and reverse supply chain to achieve the maximal contribution margin.

Circularity in Waste Electrical and Electronic Equipment (WEEE) Directive. Comparison of a Manufacturer’s Danish and Norwegian Operations

Waste electrical and electronic equipment (WEEE) as a reverse supply chain (RSC) has a low degree of circularity, mainly focusing on recovering or recycling. Targets to increase the circularity have recently been introduced in the EU WEEE directive. In this case study, we have investigated how WEEE is handled within an electric and electronic (EE) equipment manufacturer. The case study includes findings from two different Nordic countries, Norway and Denmark, with interviews of six stakeholders. The case study shows that there are significant differences in how the case company fulfills its extended producer responsibility (EPR), especially related to reporting. The study also found that there is a mismatch between the ambitions in the WEEE directive and a company’s approach related to circularity in the end-of-life phase of an EE product. Based on the results of this case study and from the literature we propose recommendations on alignment with other directives and on a common information regime within the WEEE RSC.

A reverse supply chain for medical waste: A case study in Babol healthcare sector

Medical waste generation is rapidly rising, which may cause a serious risk for both humans and environment if it is not properly managed. Designing an efficient and reliable medical waste reverse supply chain (MWRSC) is extremely beneficial to society. Most studies on this issue have only considered the generated waste and have not reported the uncertainty in the amount of medical waste generation and other MWRSC parameters. Sustainability criteria and environmental issues in choosing treatment technology are rarely considered as well. In this research, a linear programming model under uncertainty is developed to design an MWRSC. The proposed model is multi-item and multi-period with three objective functions. The first objective function minimizes total costs, the second objective function is relevant to the best treatment technology selection and the third objective function minimizes the total medical waste stored. A robust possibilistic programming approach is utilized to handle imprecise parameters in the model and a fuzzy goal programming method is employed to build up a multi-objective model. A real case study is conducted to illustrate the potential of the proposed model which involves different attributes and problems, such as the location and capacity of facilities, and the type of treatment technology. Furthermore, the transferring amount of medical waste among different nodes is calculated.

Online Reverse Supply Chain: New Layout to Promote Recycling Industry in China, 2015-2019

The article's abstract is no available.

A novel multi-objective scenario-based optimization model for sustainable reverse logistics supply chain network redesign considering facility reconstruction

With the increase of concern from environmental pollution and waste of resources, manufacturing firms have realized that the recovery of used products becomes an environment-friendly way to support sustainable development. However, many enterprises face a problem that is how to implement the recovery of used products into their existing forward logistics networks. In this case, it is necessary to redesign a novel sustainable reverse logistics supply chain network by reconstructing the existing facilities into hybrid processing facilities. To handle the foregoing problem, a multi-objective scenario-based optimization model is proposed. It aims to maximize the expected total monetary profits, minimize the expected total carbon emission costs, and maximize the expected total created job opportunities. To solve the proposed model, we develop a method to linearize the model and then apply the weighted-sum method to reformulate it as a single-objective one. In addition to the weighted-sum method, an augmented E-constraint method is used to obtain a set of efficient Pareto-optimal solutions and the trade-off among three conflicting objectives is presented. Finally, several numerical instances from a tire supply chain are performed to validate the proposed model and some managerial implications are also concluded.

Research on Reverse Supply Chain under O2O Classified Recovery Mode

In recent years, due to the continuous growth of social needs and the continuous innovation of science and technology, the demand for various products has grown rapidly. Fierce market competition has accelerated the upgrading of various products, resulting in a shortened product life cycle and a large number of obsolete products. At the same time, the development of the Internet has brought a new path for recycling-the O2O classification recycling model, which simplifies the product recycling path from consumers to manufacturers. Therefore, research based on the O2O classification recovery model has become the key to solving the waste product recovery.

Reverse logistics: Conceptualising strategies and procurement best practicesReverse logistics: Conceptualising strategies and procurement best practices

Global e-commerce in the consumer retail sector could not exist without the development, and more importantly acceptance, of sophisticated logistics strategies. The traditional forward supply chain with its inbound and outbound logistics is understood as significant to competitiveness and enterprise value. Reverse logistics, on the other hand, is that largely invisible yet widely used functionality that is increasingly having a very real impact in this economic environment. In fact, reverse logistics is in many ways inseparable from the growth of global e-commerce in the consumer retail sector. The functional elements of reverse logistics are similar to those of its traditional forward logistics counterpart and yet many striking differences exist. The reverse supply chain has a character both in business operations and in consumer buying habits that is as complex and challenging as it is essential to market performance. The strategic development of reverse logistics systems and their procurement from third-party service providers are systematically examined in this paper.

Organization's performance measurement model based on the critical success factors of the reverse supply chain in airline industry with a quality gap approach

Airline industry is one of the main infrastructures for sustainable development of a country. The quality of the reverse support service will be effective in increasing the safety and health of the structures, reducing the impact of disasters and reducing costs. The aim of this study is to evaluate the performance of an organization based on the main factors of reverse supply chain with the service quality approach using the Data Envelopment Analysis (DEA) model. In this research, firstly, performance indicators have been identified and then the efficiency of the 24 main factors of reverse supply chain success in the airline industry is determined by the output-oriented DEA-BCC model. The main efficient and inefficient factors are determined by EMS software. Performance measurement can be very useful for managers to allocate resources because it can provide patterns for inefficient units to achieve efficiency and performance improvements.

Research on the Complexity of Game Model about Recovery Pricing in Reverse Supply Chain considering Fairness Concerns

A reverse recycling supply chain consisting of two recyclers is established in this paper, which takes into account the fact that the recyclers will consider the issue of fair concern in pricing. The paper discusses the local stability of the Nash equilibrium point in this price game model showing that the fair concern factors will reduce the stable area of the system. The paper also discusses the impacts of the sensitivity of the recovery price and the price cross coefficient on the stable area of the system. Through the method of system simulation and use of some indicators, such as the singular attractor, bifurcation diagram, attraction domain, power spectrum, and maximum Lyapunov exponent, the characteristics of the system at different times will be illustrated.