Product quality dynamics in closed-loop supply chains and its sensitivity analysis

Abstract

The product quality or the product reliability is bound to be affected by the pursuit of sustainable supply chain strategy, especially the restructure and operation of closed-loop supply chain and the reverse supply chain. This paper first proposes the concept of product effectiveness which builds on the reliability and the time-utility value of product. Then based on mathematical probability theory and the dynamic characteristics of reverse supply chain logistics, this paper develops models which enable quantitative description of the endogenous dynamic mechanism of product effectiveness in closed-loop supply chains. We further explore the dynamic characteristics of product effectiveness under different sustainable procurement strategies and provide the algorithm models of product effectiveness sensitivity to components, respectively. Finally, numerical examples are presented.