Title: A bi-criteria model for closed loop supply chain network design

Authors: Subramanian Pazhani; A. Ravi Ravindran

Addresses: The Harold and Inge Marcus Department of Industrial and Manufacturing Engineering, The Pennsylvania State University, University Park, PA 16802, USA ' The Harold and Inge Marcus Department of Industrial and Manufacturing Engineering, The Pennsylvania State University, University Park, PA 16802, USA

Abstract: Closed loop supply chains (CLSC) are the integration of both forward and reverse supply chains. The integration is important as independent operations and management of forward and reverse supply chains lead to a reduction in efficiency in the supply chain as a whole. This article considers a four-stage CLSC network with commercial returns, which could be potentially recovered by light repair operations or by refurbishing. The annual estimate of commercial returns in the USA is in excess of $100 billion. This paper discusses the optimal design of a CLSC network with the objectives of maximising the profit of the supply chain and minimising the energy usage at the warehousing facilities and energy consumed during transportation. A bi-criteria mixed integer linear programming (MILP) model is developed to determine the optimal locations of the facilities and the distribution of flows between facilities in the CLSC. We propose an interactive optimisation algorithm to systematically solve the bi-criteria problem which poses less cognitive burden on the decision maker and converges faster to the best compromise solution.

Keywords: closed loop supply chain; CLSC; bi-criteria mixed integer linear program; interactive optimisation; paired comparison method; PCM.

DOI: 10.1504/IJOR.2018.089735

International Journal of Operational Research, 2018 Vol.31 No.3, pp.330 - 356

Received: 29 Jul 2014
Accepted: 02 May 2015
Published online: 09 Feb 2018 *

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