Reverse Supply Chain Network Design Problem

Abstract

The reverse supply chain network design problem is formulated as a bilevel model. In the upper level, the total cost incurred in the reverse supply chain network is minimized subject to the budget constraint, among others, whereas in the lower level the corresponding flow pattern in the network is characterized by the variable demand equilibrium conditions; this is essentially a variation of the Wardrop second principle. A sensitivity analysis–based algorithm, with special treatment of the material conversion factor at each recycler processor agent, or both, is proposed for solutions. A numerical example is then provided for demonstration.