Dual-Channel Global Closed-Loop Supply Chain Network Optimization Based on Random Demand and Recovery Rate

• Main Authors: Aijun Liu, Yan Zhang, Senhao Luo, Jie Miao
• Format: Article
• Language: English
• Published: MDPI AG 2020-11-01
• Series: International Journal of Environmental Research and Public Health
• Subjects: global closed-loop supply chain; dual-channel sales and dual-channel collection; mixed-integer linear programming; design and planning; ε-constraint method
• Online Access: https://www.mdpi.com/1660-4601/17/23/8768

In the process of globalization, customer demand is usually difficult to predict, and product recycling is generally difficult to achieve accurately. It is also urgent to deal with increased inventory while avoiding shortages, with the purpose of reducing supply chain risks. This study analyzes the integrated supply chain decision-making problem in the random product demand and return environment. It proposes a multi-objective optimization model, which is an effective tool to solve the design and planning problems of the global closed-loop supply chain. It consists of a multi-period, single-product and multi-objective mixed integer linear programming model, which can solve some strategic decision problems, including the network structure, entity capacities, flow of products and components, and collection levels, as well as the inventory levels. From the perspective of economic, environmental and social benefits, three objective functions are defined, including maximizing the net present value (NPV) of the system, minimizing the total <inline-formula><math display="inline"><semantics><mrow><mi>C</mi><msub><mi>O</mi><mrow><mn>2</mn><mi>e</mi></mrow></msub></mrow></semantics></math></inline-formula> emissions of supply chain activities, and maximizing social sustainability indicators. Finally, a numerical example is provided to verify the advantages of this model, and sensitivity analysis results are provided. The results show that changes in product demand and return rate will have a great impact on economic and social performance.