Effect of grading of product return on the network design of a reverse supply chain: a comparative study Online publication date: Wed, 06-May-2015
by Sajan T. John; R. Sridharan
International Journal of Applied Management Science (IJAMS), Vol. 7, No. 2, 2015
Abstract: In this study, the effect of grading of used products, i.e., products returned by the customers after their use, on the network design of a reverse supply chain is analysed. Two scenarios of the problem environment are considered and the network is modelled using integer linear programming formulation. The grading of the products, based on the economic value associated with it, generates an additional cost in the form of grading cost and this cost is incorporated into the model developed. The model provides an optimal solution for the sample problem considered. The comparison of the results for the two scenarios shows the monetary benefits of recovering additional value associated with the used products. The network is analysed for different settings of the quantity of product return and it is found that the quantity of product return also has a significant effect on the selection of a suitable recovery option.
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