E-commerce Based Closed-Loop Supply Chain for Plastic Recycling

The world is facing a grave plastic waste problem. It is not new that we hear about oceanic death and morbid landfills. Only 8% of all the plastic produced is recycled in the US. This grotesque situation has been worsened by the Chinese ban of plastic waste imports from the developed western nations as of 2018. In this research we assess the feasibility of a novel approach to using existing e-commerce reverse logistics channels to take back post-consumer plastic. We use product sales data to estimate the post-consumer plastic volume. We then, design a mixed integer linear programming (MILP) based optimization model to assess different take-back routes and calculate various operational costs. In addition to the optimization model we determine the feasibility of this process by considering cost offsets such as price of virgin plastics. After that, we conduct a scenario-based sensitivity analysis to understand systemic cost and overall profit. We used the results of these analyses to formulate the strategic recommendations for companies interested in promoting or implementing e-commerce-based recycling programs. Finally, we assess the greenhouse gas emissions and corresponding externality costs through this process and perform a qualitative assessment of the stakeholder networks vital to making such a system operational. In conclusion, our results suggest that in certain scenarios it is economically feasible to facilitate a take-back process for post-consumer plastic using existing e-commerce-based reverse logistics channels while maintaining minimal additional emissions in the process.