Abstract

This research focuses on the modeling of strategic supply chain network design. Several comprehensive mixed-integer-programming models are developed for the strategic integrated design of domestic and global supply chain networks with remanufacturing capacity. The models allow simultaneous determination of supplier selection, manufacturing and distribution facility selection and allocation, production quantities, transportation flows, reverse distribution facility selection, and disassembly plant allocation. Additionally, our models incorporate bill of material (BOM) both in the manufacturing process and in disassembly process. Management policies are also considered in the model formulation so that specific management choices, such as multi- sourcing strategy or single sourcing strategy, can be fulfilled in the strategic supply chain network design. Global factors considered in the model include currency exchange rates, transfer prices, allocation of transportation costs, local content requirements, local income taxes, and tariffs. The models are verified by medium-sized numerical examples. Compared to previous literature, the proposed models have two distinctive features. First, the corresponding integrated logistics problem of a global supply chain is formulated with a generalized mathematical form, and thus is not limited to applications for specific industries. Such a methodological measure is rare in previous literature, and has exhibited its potential advantages in addressing complicated global supply chain problems. Second, remanufacturing factors oriented from the enforcement of corresponding governmental regulations for environmental protection are considered in the proposed model. Thus, the corresponding effects may help to determine solution alternatives to improve the performance of a global supply chain with remanufacturing capacity