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Optimisation of integrated reverse logistics networks with different product recovery routes

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  • Niknejad, A.
  • Petrovic, D.

Abstract

The awareness of importance of product recovery has grown swiftly in the past few decades. This paper focuses on a problem of inventory control and production planning optimisation of a generic type of an integrated Reverse Logistics (RL) network which consists of a traditional forward production route, two alternative recovery routes, including repair and remanufacturing and a disposal route. It is assumed that demand and return quantities are uncertain. A quality level is assigned to each of the returned products. Due to uncertainty in the return quantity, quantity of returned products of a certain quality level is uncertain too. The uncertainties are modelled using fuzzy trapezoidal numbers. Quality thresholds are used to segregate the returned products into repair, remanufacturing or disposal routes. A two phase fuzzy mixed integer optimisation algorithm is developed to provide a solution to the inventory control and production planning problem. In Phase 1, uncertainties in quantity of product returns and quality of returns are considered to calculate the quantities to be sent to different recovery routes. These outputs are inputs into Phase 2 which generates decisions on component procurement, production, repair and disassembly. Finally, numerical experiments and sensitivity analysis are carried out to better understand the effects of quality of returns and RL network parameters on the network performance. These parameters include quantity of returned products, unit repair costs, unit production cost, setup costs and unit disposal cost.

Suggested Citation

  • Niknejad, A. & Petrovic, D., 2014. "Optimisation of integrated reverse logistics networks with different product recovery routes," European Journal of Operational Research, Elsevier, vol. 238(1), pages 143-154.
  • Handle: RePEc:eee:ejores:v:238:y:2014:i:1:p:143-154
    DOI: 10.1016/j.ejor.2014.03.034
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    3. Zikopoulos, Christos & Tagaras, George, 2015. "Reverse supply chains: Effects of collection network and returns classification on profitability," European Journal of Operational Research, Elsevier, vol. 246(2), pages 435-449.
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    7. Eiji B. Hosoda & Masashi Yamamoto, 2021. "Transportation costs of vehicle recycling under Hotelling’s Duopoly competition," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 48(1), pages 77-91, March.
    8. Panagiotidou, Sofia & Nenes, George & Zikopoulos, Christos & Tagaras, George, 2017. "Joint optimization of manufacturing/remanufacturing lot sizes under imperfect information on returns quality," European Journal of Operational Research, Elsevier, vol. 258(2), pages 537-551.
    9. Zhou, Xiaoguang & Zhou, Yanhui, 2015. "Designing a multi-echelon reverse logistics operation and network: A case study of office paper in Beijing," Resources, Conservation & Recycling, Elsevier, vol. 100(C), pages 58-69.
    10. Keyvanshokooh, Esmaeil & Ryan, Sarah M. & Kabir, Elnaz, 2016. "Hybrid robust and stochastic optimization for closed-loop supply chain network design using accelerated Benders decomposition," European Journal of Operational Research, Elsevier, vol. 249(1), pages 76-92.
    11. Xuehong Gao, 2019. "A Novel Reverse Logistics Network Design Considering Multi-Level Investments for Facility Reconstruction with Environmental Considerations," Sustainability, MDPI, vol. 11(9), pages 1-22, May.
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    14. Xiao-ping Bai & Xiu-weng Wang, 2020. "A Novel Planning Method of Urban Building Wastes for Environment Protection and Sustainable Development," SAGE Open, , vol. 10(4), pages 21582440209, November.
    15. Chen, Daqiang & Ignatius, Joshua & Sun, Danzhi & Zhan, Shalei & Zhou, Chenyu & Marra, Marianna & Demirbag, Mehmet, 2019. "Reverse logistics pricing strategy for a green supply chain: A view of customers' environmental awareness," International Journal of Production Economics, Elsevier, vol. 217(C), pages 197-210.
    16. Zhang, Yanzi & Berenguer, Gemma & Zhang, Zhi-Hai, 2024. "A subsidized reverse supply chain in the Chinese electronics industry," Omega, Elsevier, vol. 122(C).
    17. Christian Scheller & Kerstin Schmidt & Thomas Stefan Spengler, 2021. "Decentralized master production and recycling scheduling of lithium-ion batteries: a techno-economic optimization model," Journal of Business Economics, Springer, vol. 91(2), pages 253-282, March.
    18. Scheller, Christian & Schmidt, Kerstin & Spengler, Thomas S., 2023. "Effects of network structures on the production planning in closed-loop supply chains – A case study based analysis for lithium-ion batteries in Europe," International Journal of Production Economics, Elsevier, vol. 262(C).
    19. Ozden Tozanli & Gazi Murat Duman & Elif Kongar & Surendra M. Gupta, 2017. "Environmentally Concerned Logistics Operations in Fuzzy Environment: A Literature Survey," Logistics, MDPI, vol. 1(1), pages 1-42, June.
    20. Duong, Quang Huy & Zhou, Li & Meng, Meng & Nguyen, Truong Van & Ieromonachou, Petros & Nguyen, Duy Tiep, 2022. "Understanding product returns: A systematic literature review using machine learning and bibliometric analysis," International Journal of Production Economics, Elsevier, vol. 243(C).
    21. Yongbo Li & Devika Kannan & P. C. Jha & Kiran Garg & Jyoti Darbari & Neha Agarwal, 2023. "Design of a multi echelon product recovery embeded reverse logistics network for multi products and multi periods," Annals of Operations Research, Springer, vol. 323(1), pages 131-152, April.
    22. Kai Meng & Peihuang Lou & Xianghui Peng & Victor Prybutok, 2017. "Quality-driven recovery decisions for used components in reverse logistics," International Journal of Production Research, Taylor & Francis Journals, vol. 55(16), pages 4712-4728, August.
    23. Agrawal, Saurabh & Singh, Rajesh K. & Murtaza, Qasim, 2015. "A literature review and perspectives in reverse logistics," Resources, Conservation & Recycling, Elsevier, vol. 97(C), pages 76-92.
    24. Baptista, Susana & Barbosa-Póvoa, Ana Paula & Escudero, Laureano F. & Gomes, Maria Isabel & Pizarro, Celeste, 2019. "On risk management of a two-stage stochastic mixed 0–1 model for the closed-loop supply chain design problem," European Journal of Operational Research, Elsevier, vol. 274(1), pages 91-107.

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