The Closed-loop Supply Chain Implementation Feasibility Study

Due to the requirement of environment protection and economic sustainable development, product reuse has been the core motivation of pushing electronics industry to develop. Facing such pressure, manufacturers, suppliers, sales, product collectors in the industry, pushed by economic benefits and law, are necessary to cooperate and implement the closed-loop supply chain management (CLSM)-the brand new management mode.Closed-loop supply chain is a network based on the integration of forward and reverse supply chain, in which products flow from manufacturing sites to consuming sites and used products flow backward.The implementation of CLSM faces such problems as highly variable return flows of used products; difficult integration between forward and reverse logistics, but it still can bring out many benefits. The implementation of CLSM can improve "green image" of the enterprises, bringing more profits. And the advanced firms can affect the issue of law and industrial standards and hold back other enterprises into concerning fields. All these demonstrate the effects of implementing CLSM.Nowadays, the technologies supporting closed-loop supply chain have already been available. Just right before the implementation, it is necessary to validate the feasibility of CLSM, standing on the point of manufacturers.The whole closed-loop network is studied, taking electronics industry as the example. A generic simulation model for the closed-loop supply chain is constructed based on the principles of the system dynamics methodology (SD). The reverse supply chain, including product remanufacturing, is modeled added on a mature forward supply chain, taking into account not only economic but also environmental issues, such as the take-back obligation imposed by legislation, the "green image" effect on customer demand and investment costs of collection centers and remanufacturing centers.The generic closed-loop supply chain SD model uses total supply chain profits as measure. Through the simulation, graph for total profits can be modeled, comparing it with the profits curve of forward supply chain, then the conclusion is reached that in the long term the saved costs by bring into effect closed-loop supply...