This paper analyses the inventory and order flow dynamics in closed-loop supply chains (CLSCs). In this kind of supply chains the reverse flow of materials entering the system for recycling purposes complicates the way in which inventories should be managed and replenishment policies should be designed. Specifically, we analyse the relationships between some reverse logistics’factors (remanufacturing lead-time, return rate of recycled products, reverse order policy, and number of supply chain tiers) on theorder and inventory variance amplification. We firstly perform a systematic literature review of the related studies. Secondly, by adopting a difference equation math approach and design of experiment we perform a robust what-if analysis of a CLSC under a variety of operational and market conditions. Results show that, ceteris paribus, CLSC outperforms a forward supply chain, both in mono-echelon and multi-echelon structures and under both stationary and turbulent market demands. Furthermore, reducing remanufacturing lead-time and promoting information transparency may be crucial to improve CLSC dynamics. Finally, we use the research findings to provide interesting managerial consideration about how to reduce unnecessary operational members’costs.

Closed-loop supply chains: What reverse logistics factors influence performance?

CANNELLA, SALVATORE;
2016

Abstract

This paper analyses the inventory and order flow dynamics in closed-loop supply chains (CLSCs). In this kind of supply chains the reverse flow of materials entering the system for recycling purposes complicates the way in which inventories should be managed and replenishment policies should be designed. Specifically, we analyse the relationships between some reverse logistics’factors (remanufacturing lead-time, return rate of recycled products, reverse order policy, and number of supply chain tiers) on theorder and inventory variance amplification. We firstly perform a systematic literature review of the related studies. Secondly, by adopting a difference equation math approach and design of experiment we perform a robust what-if analysis of a CLSC under a variety of operational and market conditions. Results show that, ceteris paribus, CLSC outperforms a forward supply chain, both in mono-echelon and multi-echelon structures and under both stationary and turbulent market demands. Furthermore, reducing remanufacturing lead-time and promoting information transparency may be crucial to improve CLSC dynamics. Finally, we use the research findings to provide interesting managerial consideration about how to reduce unnecessary operational members’costs.
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Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/20.500.11769/244207
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