Reverse Logistics Network Design under the Risk of Hazardous Materials Transportation

An effective reverse logistics network design (RLND) has several implications, such as decrease in logistics costs and environmental damage. Some products in the RL may contain hazardous substances. In such cases, the environmental aspects of RLND should be identified considering the risks of hazardous materials transportation. In this study, a holistic approach is employed involving the forecasting of return amount of products, risk modeling of hazardous materials transportation, and capacitated plant location modeling under risk. An application for the reverse logistics of large household appliances in Turkey, which is aiming to implement the European Union directive for waste electric and electronic equipment, is presented. First, the decisions of suitable places for treatment facilities and the assignments of the returned products to these facilities are made without considering the risk factor. In this case, the objective is to minimize the total logistics costs. In the second case, risk factors are incorporated in the model and the objective is defined as the minimization of the costs and hazmat transportation risks. It is seen that different locations and allocation decisions are obtained for the case without considering the risk and the case under risk of hazmat transportation.