Sustainable economic policies for a VMI-CS-based closed-loop supply chain with quality control measures under the carbon cap-and-trade regulation

The present study evaluates the effects of making various initial investments on the economic and environmental sustainability of a closed-loop supply chain (CLSC), comprising a single manufacturer and multiple retailers, who are tied under the vendor-managed inventory with consignment stock (VMI-CS) framework, along with a single supplier and multiple collectors, who ensure the continuous availability of resources for the manufacturer. Unlike established articles, this study considers the initial green investment of each and every chain-partner for reducing carbon emissions under the cap-and-trade regulation of the Paris Accord. Another key aspect of this study is collectors’ inspection-related investments, which aim to reduce costs of sorting recyclable products from used ones, whereas this study emphasizes quality control by including the reworking of both the defective fresh and defective remanufactured products. Employing one novel algorithm, integrating atomic orbital search-based metaheuristic and fuzziness, this study optimally determines ten decision variables of the proposed model. Current results showed that increasing the number of shipments of remanufactured products relative to fresh manufactured ones significantly enhanced the total profit of the proposed VMI-CS-based CLSC model. Even while defective rates had a relatively minor impact on total profit, the sale price of remanufactured products could critically affect the profitability of the proposed model. Thus, this study pleaded managers to strategically balance the inflow of raw materials and fresh products across chain-partners with the return flow of recyclable used items. Also, this study seeks to stimulate the demand of fresh products while maintaining a moderate demand of remanufactured products and thus boost the total profit of current model.