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https://hdl.handle.net/2142/84554
Description
Title
Product Returns in Closed Loop Demand Chains
Author(s)
Yalabik, Baris
Issue Date
2006
Doctoral Committee Chair(s)
Chhajed, Dilip
Petruzzi, Nicholas C.
Department of Study
Business Administration
Discipline
Business Administration
Degree Granting Institution
University of Illinois at Urbana-Champaign
Degree Name
Ph.D.
Degree Level
Dissertation
Keyword(s)
Business Administration, Management
Language
eng
Abstract
"The flow of products usually occurs from manufacturers to consumers. In recent years the reverse flow---the number of items moving from consumers to manufacturers---has been gaining momentum. These returns can occur in a variety of ways, from customers taking advantage of a refund policy to warranty contracts to discards of items that have come to the ends of their useful lives. Competitive and legal forces and the need for more efficient manufacturing are now driving the need to better manage returns. A closed loop supply chain is a supply chain that is designed to consider the acquisition and return flows of products, reuse activities, and the distribution of the recovered products. A ""demand chain"" focuses on what the customer wants and needs, as opposed to seeing the customer as a closed box that generates some random demand. We define a ""closed loop demand chain"" as ""a closed loop supply chain that is designed to consider customer characteristics and the influence of its decisions on the structure of the market it is serving"". Our aim is to describe and analyze the operational and strategic decisions that need to be made in a closed loop demand chain. We use two examples: A product returns system and a remanufacturing system. For both cases, we solve for the optimal decisions of the firm and derive related insights. For the case of the remanufacturing system, we also examine the impact of remanufacturing on profits, customer surplus, and environmental friendliness, when compared to not remanufacturing."
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