Reverse logistics risk management: identification, clustering and risk mitigation strategies

PurposeReverse logistics (RL), an inseparable aspect of supply chain management, returns used products to recovery processes with the aim of reducing waste generation. Enterprises, however, seem reluctant to apply RL due to various types of risks which are perceived as posing an economic threat to b...

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Bibliographic Details
Published in:Management decision 2020-09, Vol.58 (7), p.1449-1474
Main Authors: Panjehfouladgaran, Hamidreza, Lim, Stanley Frederick W.T
Format: Article
Language:English
Subjects:
Consumers
Consumption
Logistics
Order picking
Product life cycle
Production planning
Raw materials
Reverse logistics
Risk factors
Social responsibility
Suppliers
Supply chain management
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Summary:PurposeReverse logistics (RL), an inseparable aspect of supply chain management, returns used products to recovery processes with the aim of reducing waste generation. Enterprises, however, seem reluctant to apply RL due to various types of risks which are perceived as posing an economic threat to businesses. This paper draws on a synthesis of supply chain and risk management literature to identify and cluster RL risk factors and to recommend risk mitigation strategies for reducing the negative impact of risks on RL implementation.Design/methodology/approachThe authors identify and cluster risk factors in RL by using risk management theory. Experts in RL and supply chain risk management validated the risk factors via a questionnaire. An unsupervised data mining method, self-organising map, is utilised to cluster RL risk factors into homogeneous categories.FindingsA total of 41 risk factors in the context of RL were identified and clustered into three different groups: strategic, tactical and operational. Risk mitigation strategies are recommended to mitigate the RL risk factors by drawing on supply chain risk management approaches.Originality/valueThis paper studies risks in RL and recommends risk management strategies to control and mitigate risk factors to implement RL successfully.
ISSN:0025-1747
1758-6070
DOI:10.1108/MD-01-2018-0010