Sustainable reverse logistics network design using simulation: Insights from the fashion industry

Abstract

• The environmental impact of reverse logistics is critical in the fashion industry. • Fashion luxury brands must balance LT and environmental performances to compete. • Choices about decentralization and transportation modes impact on these KPIs. • Supply chain simulation effectively assesses trade-off in network design. • Scenario analyses for a fashion luxury brand are performed to validate the approach. While direct logistics optimization is a common practice, reverse logistics management is frequently neglected. This study explores how reverse logistics configurations affect the environmental sustainability of global supply chains in the fashion industry. The paper addresses the gap in the literature regarding carbon footprint of hybrid configurations for return flows. A case study is conducted in an Italian luxury fashion company with global operations, and we use supply chain simulation to assess sustainability-focused network design alternatives. The findings reveal that decentralizing specific operations significantly reduces carbon footprint without compromising service levels or lead time, both critical aspects in such segment. This research emphasizes the importance of considering reverse logistics in the overall sustainability strategy of supply chains, offering practical insights for businesses seeking to balance environmental impact with operational efficiency in the fashion industry.