A new location-inventory policy with reverse logistics applied to B2C e-markets of China

Based on the characteristics of consumer purchasing behavior over business-to-consumer (B2C) electronic markets in China, we consider a supply chain with one supplier, one B2C firm and multiple distribution centers (DCs) to jointly study supply chain location and inventory policies when product retu...

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Bibliographic Details
Published inInternational journal of production economics Vol. 107; no. 2; pp. 350 - 363
Main Authors Wang, Ziping, Yao, Dong-Qing, Huang, Peiqing
Format Journal Article
LanguageEnglish
Published Amsterdam Elsevier B.V 01.06.2007
Elsevier
Elsevier Sequoia S.A
SeriesInternational Journal of Production Economics
Subjects
B2C
Bi-level programming
China
Coordinated inventory policy
Distribution centers
Electronic commerce
Inventory
Inventory control
Logistics
Mathematical programming
Product returns
Reverse logistics
Studies
Supply chains
China
Coordinated inventory policy
B2C
Bi-level programming
China
Reverse logistics
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Summary:Based on the characteristics of consumer purchasing behavior over business-to-consumer (B2C) electronic markets in China, we consider a supply chain with one supplier, one B2C firm and multiple distribution centers (DCs) to jointly study supply chain location and inventory policies when product returns are allowed for. A new location-inventory policy is proposed and modeled as a bi-level programming problem: The upper level determines appropriate locations of third checking sites (3CS), and the lower level presents a coordinated inventory replenishment QS_R policy in light of the 3CS locations. An abstract network based on a B2C firm in China is adopted to illustrate the proposed model. We find that a QS_R policy is more effective on inventory control than the independent control policy is; 3CS added into the network improves the B2C firm's profit, and sensitivity analysis provides interesting managerial insights into the B2C firm's profit improvement in China.
ISSN:0925-5273
1873-7579
DOI:10.1016/j.ijpe.2006.09.012