Abstract

Over the past few years, manufacturers in several countries are faced with legislations on the take-back of their End-Of-Life (EOL) products. Meanwhile, many companies are recognizing the product recovery as an opportunity for saving production costs and accessing new markets. Reverse supply chains (RSCs) process used products returns so as to recover value by re-processing them and redistributing them in the market. This thesis proposes a RSC design model that simultaneously considers forward and reverse flows in the context of durable products. Such products consist of different modules, parts, and materials that can be recovered through several disposition options. Since RSCs deal with multiple quality states of used items, we assume that the returned items fit into two quality categories that differ in the quantities of recoverable components, as well as their available quantity and price. Unlike the majority of contributions in the literature, we focus on all types of recovery options in the network design model. Moreover, rather than considering a single profit maximization objective function, we also consider another objective for maximizing environmental benefits. We formulate this problem as a mixed integer linear programming (MILP) model. We apply the proposed model to an academic case study in the context of EOL washing machines. The bi-objective RSC design model is solved by the aid of the ɛ-constraint method. Finally, in order to identify the significant factors affecting each objective function, a set of sensitivity analysis tests is conducted. Managerial implications are also provided based on the results of the sensitivity analysis and the ɛ-constraint method.