Analysing the Usefulness of Circular Strategies to Improve Supply Chain Resilience Against Demand Changes

Demand changes in a supply chain are common events and can hurt its resilience and profitability. It is important to develop appropriate strategies to mitigate demand changes in supply chains. This study develops mathematical modelling and simulation approaches to deal with demand changes using circular strategies. First, a mathematical model is developed to design a supply chain under ideal situations. Then, the model is revised to analyse the impacts of demand changes and further extended to analyse the usefulness of circular strategies to mitigate increased demand. The anyLogistix simulation approach is used to solve the mathematical models and analyse the results of the distribution of an Australian smartphone brand. A sensitivity analysis is also conducted to investigate the impacts of key variables on cost, profit, and demand fulfilment. The results indicate that there will be significant losses in profit and demand fulfilment if the increased demand is not dealt with appropriately. The results also demonstrate a significant benefit of using circular strategies, such as repair and reuse, to improve demand fulfilment and profitability by mitigating the increased demand. This study is unique in the literature as it investigates the usefulness of circular strategies, such as repair and reuse, quantitatively to mitigate increased demand and improve supply chain resilience performance, such as total profit and demand fulfilment. Decision-makers can use the developed models and simulation approaches and the findings to make decisions on how to apply repair and reuse strategies for a smartphone distribution system and to improve its resilience and sustainable performance.