Closed-Loop Supply Chain Network Design with Recovery of Glass Containers

Sina Golara, Nasim Mousavi, Mohammad Jafar Tarokh and Mostafa Hosseinzadeh
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Sina Golara: Industrial Engineering Department, K. N. Toosi University of Technology, Tehran, Iran
Nasim Mousavi: Industrial Engineering Department, K. N. Toosi University of Technology, Tehran, Iran
Mohammad Jafar Tarokh: Industrial Engineering Department, K. N. Toosi University of Technology, Tehran, Iran
Mostafa Hosseinzadeh: Department of Industrial Engineering, Islamic Azad University, Arak Branch, Arak, Iran

International Journal of Strategic Decision Sciences (IJSDS), 2012, vol. 3, issue 4, 1-26

Abstract: Reverse logistics (RL) and closed-loop supply chains (CLSC) have recently received enormous attention due to growing environmental concerns and legislations coupled with the lucrative business potential. The main purpose of this paper is to develop a closed-loop supply chain network design model capable of recovering glass containers. A multi-period multi-product mixed-integer linear programming model is proposed to maximize profit. The strategic design of the supply chain is dealt simultaneously with the tactical planning of its operation, which covers procurement, production, storage, distribution, take-back, reprocessing, reuse, and recycling. To illustrate the efficiency and practicability of the model, it is applied to a real-world case of beverage supply chain where the glass containers are either re-used or recycled into their original form, as raw materials. Finally, sensitivity analyses, from a financial perspective, have been conducted to reveal the determinants of profitable product recovery and grasp their managerial implications. The analyses showed that return rate and return acquisition cost have determinant impact on the economic viability of product recovery practice.

Date: 2012
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