Closed loop supply chains: The impact of advance notice and lead-times


This research investigates the impact of advance notice of the product returns on the performance of a closed loop supply chain when lead-times exist. Our closed loop supply chain consists of a manufacturer and an external remanufacturer. The market demand and the product return are stochastic and correlated with each other. A proportion of the sold products in the market are returned to an external remanufacturer. After a predetermined time period, the used products are converted into good-as-new products to be used to meet the market demand, together with the newly manufactured products. We quantify the benefit of the manufacturer obtaining advance notice of product returns from the remanufacturer. Furthermore, we demonstrate that the (re)manufacturing lead-times and some parameters in the product return rate can have a significant impact on the manufacturer’s performance.

4th World Production and Operations Management Conference, Amsterdam, Holland, 1st - 5th, 11 pages