The beneficial effect of information sharing in a two-stage reverse supply chain

Abstract

In this paper, we analyse the effect of information sharing structure in which collection and remanufacturing capacity design is considered under the stochastic environment. We consider a two-stage reverse supply chain, which consists of single collector and single remanufacturer, and these two actors collaborate with each other to share their own information in order to get better performance from system perspective. We develop four different optimisation models according to the schemes of these two actors' collaboration for information sharing. Through a numerical example, we examine the value of information sharing with consideration of variance, and identify the robustness of the models in a simulation study. From the extensive numerical analyses, we conclude that the issues who leads information sharing scheme between two actors and which information is shared can show different performance for both each individual actor and system. Furthermore, with respect to information uncertainty, the significance of variance management on return rate in a reverse supply chain is also identified.