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Design and analysis of a closed-loop supply chain in presence of promotional offer

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  • Debabrata Das
  • Pankaj Dutta

Abstract

Closed-loop supply chain (CLSC) has been an area of increasing attention during the last decade due to its economic impact, strict legislations and social awareness. Profitability of any remanufacturing process is mainly driven by the effective and efficient acquisition of used products. In this paper, a market-driven recovery framework is proposed to acquire the used products from consumers by taking into account their buying patterns as well as the willingness to accept a promotional offer. The proposed framework is integrated with an optimisation model for a multi-period CLSC to maximise the overall profit of the system by determining the optimal discount amount along with the decision of finding optimal manufacturing, remanufacturing and disposal quantity. The findings of the study provide several insights to the decision-makers that lead to better performance of the entire closed-loop system. The analysis suggests a trade-off among manufacturing/remanufacturing cost, penalty cost for not fulfilling the legislation criterion and collection cost due to the employment of promotional offer. Sensitivity analysis is performed to observe the effect of various important parameters on the system’s performance. Finally, a comparative study has been conducted to examine the performance of the CLSC with vs. without promotional offer.

Suggested Citation

  • Debabrata Das & Pankaj Dutta, 2015. "Design and analysis of a closed-loop supply chain in presence of promotional offer," International Journal of Production Research, Taylor & Francis Journals, vol. 53(1), pages 141-165, January.
    • Handle: RePEc:taf:tprsxx:v:53:y:2015:i:1:p:141-165
    DOI: 10.1080/00207543.2014.942007
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    Cited by:

    1. Manoj Kumar Paras & Daniel Ekwall & Rudrajeet Pal & Antonela Curteza & Yan Chen & Lichuan Wang, 2018. "An Exploratory Study of Swedish Charities to Develop a Model for the Reuse-Based Clothing Value Chain," Sustainability, MDPI, vol. 10(4), pages 1-19, April.
    2. Tanksale, Ajinkya N. & Das, Debabrata & Verma, Priyanka & Tiwari, Manoj Kumar, 2021. "Unpacking the role of primary packaging material in designing green supply chains: An integrated approach," International Journal of Production Economics, Elsevier, vol. 236(C).
    3. Gunasekara, Lahiru & Robb, David J. & Zhang, Abraham, 2023. "Used product acquisition, sorting and disposition for circular supply chains: Literature review and research directions," International Journal of Production Economics, Elsevier, vol. 260(C).
    4. Luttiely Santos Oliveira & Ricardo Luiz Machado, 2021. "Application of optimization methods in the closed-loop supply chain: a literature review," Journal of Combinatorial Optimization, Springer, vol. 41(2), pages 357-400, February.
    5. Maiti, T. & Giri, B.C., 2017. "Two-way product recovery in a closed-loop supply chain with variable markup under price and quality dependent demand," International Journal of Production Economics, Elsevier, vol. 183(PA), pages 259-272.
    6. M. Masanta & B. C. Giri, 2022. "A closed-loop supply chain model with learning effect, random return and imperfect inspection under price- and quality-dependent demand," OPSEARCH, Springer;Operational Research Society of India, vol. 59(3), pages 1094-1115, September.
    7. Hua, Meina & Lai, Ivan Ka Wai & Tang, Huajun, 2019. "Analysis of advertising and a points-exchange incentive in a reverse supply chain for unwanted medications in households based on Game Theory," International Journal of Production Economics, Elsevier, vol. 217(C), pages 259-268.
    8. Das, Debabrata & Dutta, Pankaj, 2022. "Product return management through promotional offers: The role of consumers’ loss aversion," International Journal of Production Economics, Elsevier, vol. 251(C).
    9. Dexiang Yang & Lei Zhang & Ying Wu & Sidai Guo & Hua Zhang & Lijian Xiao, 2018. "A Sustainability Analysis on Retailer’s Sales Effort in A Closed-Loop Supply Chain," Sustainability, MDPI, vol. 11(1), pages 1-20, December.

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