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Using Machine Learning Algorithms For Forecasting Rate of Return Product In Reverse Logistics Process

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  • Ayşe Nur Adıgüzel Tüylü
  • Ergün Eroğlu

Abstract

Many textile products are in reverse logistics network due to mistakes made in activities such as sales forecasting, inventory planning and distribution. In order to reduce resource usage and cost at first step, in addition to producing the correct quantity, these products must be sent to branches, in correct properties (amount, color, size, model…) and transportation planning and stock planning should be done correctly. Statistical methods, artificial intelligence and machine learning methods are used because of the difficulty of establishing mathematical models in multi-parameter and multi-variable problems. In general, all these activities are based on demand forecasts by time series, but there are important differences between these demand predictions and the actual demands because of fashion and consumers’ requests change very quickly. Artificial intelligence and machine learning methods provide faster and more accurate results in complex data sets. The difference of this study from other studies is to estimate the product return rates in Reverse Logistics with Machine Learning. In this direction, it is aimed to predict the claims accurately by concentrating on the customers' preferences, their reasons and the replies of the products which are sold to the customers. Thus, the consumer information obtained as a result of these analyzes can provide us with more accurate planning in terms of avoiding unnecessary production, transportation and storage activities, and sending the products with the correct properties; amount, color, size and model, to the branches. Best results (the correlation coefficient value is 82.35% and lowest error metrics) of this study are obtained with M5P algorithms of machine learning techniques

Suggested Citation

  • Ayşe Nur Adıgüzel Tüylü & Ergün Eroğlu, 2019. "Using Machine Learning Algorithms For Forecasting Rate of Return Product In Reverse Logistics Process," Alphanumeric Journal, Bahadir Fatih Yildirim, vol. 7(1), pages 143-156, June.
  • Handle: RePEc:anm:alpnmr:v:7:y:2019:i:1:p:143-156
    DOI: http://dx.doi.org/10.17093/alphanumeric.541307
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    References listed on IDEAS

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    3. Fleischmann, Moritz & Bloemhof-Ruwaard, Jacqueline M. & Dekker, Rommert & van der Laan, Erwin & van Nunen, Jo A. E. E. & Van Wassenhove, Luk N., 1997. "Quantitative models for reverse logistics: A review," European Journal of Operational Research, Elsevier, vol. 103(1), pages 1-17, November.
    4. Saurabh Agrawal & Rajesh K. Singh & Qasim Murtaza, 2014. "Forecasting product returns for recycling in Indian electronics industry," Journal of Advances in Management Research, Emerald Group Publishing Limited, vol. 11(1), pages 102-114, April.
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    More about this item

    Keywords

    Forecasting Rate of Return Product; Machine Learning; Reverse Logistics; Textile;
    All these keywords.

    JEL classification:

    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics

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