Sustainable closed-loop supply chain model with stochastic demand and return

Abstract

The closed-loop supply chain (CLSC) represents the supply chain that contains recovery plans for used products to be reused later in the industry. The research gap in the previous CLSC literature regarding the sustainability aspects for the CLSC was the lack of consideration for the social aspect due to its complexity. Also, the effect of demand and product returns uncertainties on the sustainability aspects of CLSC have not been considered in the previous CLSC studies under centralized management and synchronized ordering policy (SOP). Moreover, the analysis of stochastic sustainable CLSC has not been investigated in industries such as home appliances. Finally, the CLSC sustainability has not been analyzed with previous consideration of CLSC tiers coordination. Thus, the objective of this research was to model a stochastic sustainable CLSC that included the environmental, economic, and social aspects while considering uncertainties in demand and returns quantities for home appliance products under SOP and centralized management. For the proper stochastic CLSC design and mathematical modeling of the sustainable stochastic CLSC, the mathematical model was developed as a multiproduct, multi-echelon single period CLSC model under the SOP and centralized management. The stochastic sustainable CLSC model added constraints related to inventory management for the SOP, production capacity, transportation capacity, and carbon emission. The sustainable stochastic CLSC model was described as a mixed-integer non-linear programming model. The sustainability objectives were optimized using the Pareto-based constrained optimization of nonlinear approximation algorithm (Pareto-based COBYLA) by identifying the optimal quantities of parts and products for each CLSC tier and solving the optimization problem using the PYTHON program which was then compared with the nondominated sorting genetic algorithm (NSGA). The optimization results showed the significance of the stochastic demand and product return parameters on the sustainability objectives in the stochastic sustainable home appliance CLSC following SOP. The current research has contributed to the CLSC studies by developing a stochastic sustainable CLSC mathematical model following the SOP assumption for home appliance products considering the economic, environmental, and social objectives and adding the Pareto-based COBYLA solution algorithm that provided a better optimal solution for stochastic sustainable CLSC optimization in comparison with the NSGA.