Sustainable supply chain design: A closed-loop formulation and sensitivity analysis

Tarek Abdallah, Ali Diabat, David Simchi-Levi

    Research output: Contribution to journalArticle

    Abstract

    We introduce the uncapacitated closed-loop location inventory model, which captures the interdependency between location inventory decisions in the forward and reverse supply chains. We consider a supply chain network in which a single plant ships one type of product through distribution centres to a set of retailers, each with uncertain demand. On the other end, retailers are given the responsibility of collecting and sorting the returned products. Remanufacturing centres serve as the intermediary between recovery of the products and their re-entry to the market as spare parts. A sensitivity analysis for different parameters of the model reveals that the value of recovered products is a major factor in the economic feasibility of the closed-loop network. Finally, we present a flexible framework for policymakers, using carbon credit allocations and trading, to enhance the economic feasibility of reverse logistics, while at the same time penalising companies that do not recover their products.

    Original languageEnglish (US)
    Pages (from-to)120-133
    Number of pages14
    JournalProduction Planning and Control
    Volume23
    Issue number2-3
    DOIs
    StatePublished - Feb 1 2012

    Fingerprint

    Supply chains
    Sensitivity analysis
    Economics
    Reentry
    Sorting
    Logistics
    Ships
    Recovery
    Carbon
    Industry
    Supply chain design
    Retailers

    Keywords

    • Carbon credits
    • Closed-loop supply chain
    • Economic order quantity
    • Flexible legislation
    • Remanufacturing
    • Reverse logistics

    ASJC Scopus subject areas

    • Computer Science Applications
    • Strategy and Management
    • Management Science and Operations Research
    • Industrial and Manufacturing Engineering

    Cite this

    Sustainable supply chain design : A closed-loop formulation and sensitivity analysis. / Abdallah, Tarek; Diabat, Ali; Simchi-Levi, David.

    In: Production Planning and Control, Vol. 23, No. 2-3, 01.02.2012, p. 120-133.

    Research output: Contribution to journalArticle

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