Modelling Circular Material Flow and the Consequences for SCM and PPC

This paper discusses the consequences of product return and circular material flow on a supply chain as well as on production planning and control. Furthermore, this paper presents an approach to incorporate the ideas of product return and circular material flow into the Hanoverian Supply Chain Model. To reach this goal a reverse supply chain is added to the existing framework. First of all, the flows of material in the reverse supply chain are defined in an abstract way. Secondly, the reverse supply chain is divided into core processes. The connections between these core processes of the forward and the reverse supply chain are depicted. Subsequently, systems of KPIs are set up for the core processes of the reverse supply chain. In a last step, the consequences of the integration of a reverse supply chain on planning, controlling and monitoring production are discussed