Analysing the effects of reverse logistics on supply chain performance in the presence of demand uncertainties and bullwhip effect: comparison of two modes via system dynamics

Abstract

In the line with the Covid-19 pandemic and the lockdown occurrence, all small, medium, and large companies are negatively affected. Thus, they are forced to change their practices by competing among their supply chains in order to survive by reducing the high costs and by increasing their profit. Furthermore, they aim to strength the efficiency and performance of their business and attract more agents and customers to their products and services and reduce the common problems facing them such as market demand high variances and bullwhip effect (BWE). To achieve this goal, this research sheds light on the integration of reverse logistics (RL) activities within the supply chain network especially the remanufacturing activity by using the System Dynamics approach (SD) as a method of optimization. In this work, we made comparison between two models (traditional supply chain and supply chain with remanufacturing) to observe which model would be more appropriate to ensure the sustainability of improved performance economically, socially, and environmentally. The results showed that the supply chain with remanufacturing activity had positive impacts on the system compared to the traditional model, even BWE is reduced. This conclusion would certainly help the decision makers take an important step in using reverse logistic activities to increase their profitability, at the same time encourage the consumers to be conscious in protecting the earth by working together with such organizations that care about reducing environment hazards on long term basis.