A Carbon Sensitive Multi Echelon Reverse Logistics Network Design for Product Value Recovery

Abstract

Increase in environmental concerns and consumer awareness together with imposition of government regulations are forcing electronic industries to set up their own reverse logistics network. An evaluation of the impact of their reverse logistics activities is also imperative for the design of an effective and efficient reverse supply chain. This paper presents a bi objective mixed integer linear programming model for a reverse logistics network design that considers value added recovery of return of end of life (EOL) products and also focuses on controlling the transportation activities involved in the reverse logistics system, a major contributor to the increase in carbon emission. The objectives are to maximise the product’s value recovery by determining the optimum flow of products and components across facilities in the network and minimise the carbon emission by determining the optimum routes to be taken by vehicles and by appropriate selection of vehicles. The reverse logistics model developed is goal programming model and it takes into account two objectives with almost equal weightage. The model captures the trade-offs between total profit and emission of CO₂. The model is justified by a case study in the context of the reverse logistics network design of an Indian company manufacturing air conditioners and refrigerators.