Sustainable closed-loop supply chain management for a two-warehouse system with trade-credit and emissions...

A two-warehouse inventory model is introduced with the manufacturer and retailer. They both use two warehouses for storing and selling products, with their own and a rental warehouse. The manufacturer produces both perfect and imperfect products. Defective products returned from the retailer are sent for remanufacturing. All remanufacturing products are shifted to the secondary retail stores. Every product has a lifespan, and to reduce deterioration, the manufacturer and the retailer invest in preservation technology. Both players offer trade credits to their customers. To achieve environmental sustainability, both the manufacturer and the retailer calculate and pay for their carbon emissions. The retailer advertises products in the market, as advertising policy is a significant policy for enhancing any business by attracting customers. A sustainable supply chain management model is developed to optimize the production rate, remanufacturing rate, and cycle time. A numerical experiment is performed to validate the study, and a sensitivity analysis is conducted to provide insights to managers. From numerical findings, if the holding cost increases to 20%, the profit decreases to 0.03%. The numerical results indicate the importance of remanufacturing, carbon emissions, and product quality control within a sustainable supply chain.