A Multi-Echelon Network Design in a Dual-Channel Reverse Supply Chain Considering Consumer Preference

• Main Authors: Peng Li, Di Wu
• Format: Article
• Language: English
• Published: MDPI AG 2021-04-01
• Series: International Journal of Environmental Research and Public Health
• Subjects: dual-channel reverse supply chain (DRSC); network design; consumer preference; ε-constraint method
• Online Access: https://www.mdpi.com/1660-4601/18/9/4760

The rapid development of e-commerce technologies has encouraged collection centers to adopt online recycling channels in addition to their existing traditional (offline) recycling channels, such the idea of coexisting traditional and online recycling channels evolved a new concept of a dual-channel reverse supply chain (DRSC). The adoption of DRSC will make the system lose stability and fall into the trap of complexity. Further the consumer-related factors, such as consumer preference, service level, have also severely affected the system efficiency of DRSC. Therefore, it is necessary to help DRSCs to design their networks for maintaining competitiveness and profitability. This paper focuses on the issues of quantitative modelling for the network design of a general multi-echelon, dual-objective DRSC system. By incorporating consumer preference for the online recycling channel into the system, we investigate a mixed integer linear programming (MILP) model to design the DRSC network with uncertainty and the model is solved using the ε-constraint method to derive optimal Pareto solutions. Numerical results show that there exist positive correlations between consumer preference and total collective quantity, online recycling price and the system profits. The proposed model and solution method could assist recyclers in pricing and service decisions to achieve a balance solution for economic and environmental sustainability.