Title: A strategic model for the closed-loop supply chain network design for omni-channel retailing

Authors: Rajveer Singh; Ankit Chouksey; Ajinkya N. Tanksale; Cherian Samuel

Addresses: Department of Mechanical Engineering, Indian Institute of Technology (BHU), Varanasi 221005, India ' Department of Mechanical Engineering, Indian Institute of Technology (BHU), Varanasi 221005, India ' Department of Mechanical Engineering, Indian Institute of Technology (BHU), Varanasi 221005, India ' Department of Mechanical Engineering, Indian Institute of Technology (BHU), Varanasi 221005, India

Abstract: The 'omni-channel' way is to provide a seamless shopping experience to the customers through the integration of product information and delivery through hybrid combination of physical and online channels. The paradigm shift from multi-channel to omni-channel has posed several implementation challenges. The key challenge is the design of supply chain network in an omni-channel paradigm which is addressed in this paper. We consider an omni-channel retail supply chain with the online, showroom and store channels for the product information and in-store pick-up/drop-off and home delivery/pickup as the product fulfilment/recovery channels. A mixed-integer programming (MIP) model is proposed to minimise the location and allocation costs. The model provides an optimal configuration of different facilities and demand allocation patterns in the omni-channel environment. The concept of the model is demonstrated with an illustrative example. A MIP-based mathematical heuristic is developed to solve the problem efficiently. The sensitivity of the model to key parameters is demonstrated with computational experiments and finally, a scenario-based robust optimisation model is also proposed to capture the uncertainty in various types of demands.

Keywords: omni-channel; retail; supply chain; network design; heuristic.

DOI: 10.1504/IJLSM.2023.135436

International Journal of Logistics Systems and Management, 2023 Vol.46 No.4, pp.484 - 517

Received: 22 Nov 2020
Accepted: 15 Jun 2021
Published online: 12 Dec 2023 *

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