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Optimal decisions in reducing loss rate of returnable transport items

Author

Listed:
  • Xiangxiang Fan

    (EM - EMLyon Business School)

  • Yeming Gong
  • Xianhao Xu
  • Bipan Zou

Abstract

Returnable transport items (RTI) have been commonly used due to their advantages in reducing packaging waste and improving supply chain sustainability. However, RTI loss will result in a mismatch between the products flow and the RTI supply, which will affect operational continuity. This paper studies a RTI supply chain consisting of a single manufacturer and a single retailer, assuming that the retailer can reduce RTI loss by investing in staff training. We first develop an inventory model to minimize the total cost of the system. Then we analyze the optimal decision of the closed-loop supply chain of RTI. We compare the case where the retailer invests in reducing RTI loss and the case where the retailer does not. The results show that the supply chain will be more efficient if the retailer invests in reducing RTI loss, and the total cost of the system will be reduced. However, the retailer will invest only when its cost decreases. Thereby, we consider side payments as an available incentive to stimulate the retailer to invest. Moreover, we build an asymmetric Nash bargaining model considering investment cost sharing to coordinate the RTI supply chain. We compare the total optimal cost of the manufacturer and the retailer. The results show that the system can be coordinated, and the optimal total costs of both the manufacturer and the retailer are reduced.

Suggested Citation

  • Xiangxiang Fan & Yeming Gong & Xianhao Xu & Bipan Zou, 2019. "Optimal decisions in reducing loss rate of returnable transport items," Post-Print hal-02312287, HAL.
    • Handle: RePEc:hal:journl:hal-02312287
    as

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    Citations

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    Cited by:

    1. Julio C. Londoño & Rafael D. Tordecilla & Leandro do C. Martins & Angel A. Juan, 2021. "A biased-randomized iterated local search for the vehicle routing problem with optional backhauls," TOP: An Official Journal of the Spanish Society of Statistics and Operations Research, Springer;Sociedad de Estadística e Investigación Operativa, vol. 29(2), pages 387-416, July.
    2. Najoua Lakhmi & Evren Sahin & Yves Dallery, 2022. "Modelling the Returnable Transport Items (RTI) Short-Term Planning Problem," Sustainability, MDPI, vol. 14(24), pages 1-23, December.
    3. Liu, Guoquan & Li, Lei & Chen, Jianghang & Ma, Fei, 2020. "Inventory sharing strategy and optimization for reusable transport items," International Journal of Production Economics, Elsevier, vol. 228(C).
    4. Yanqi Zhang & Xiaofei Kou & Haibin Liu & Shiqing Zhang & Liangliang Qie, 2022. "IoT-Enabled Sustainable and Cost-Efficient Returnable Transport Management Strategies in Multimodal Transport Systems," Sustainability, MDPI, vol. 14(18), pages 1-22, September.

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