ReRunning to Cardiff
Why is closing the loop not as straightforward as keeping things linear?
Some of our staff contribute to academic research projects from time to time. ReRun at Cardiff Business School is one such project. BT, Panalpina and Qioptic are three of the other companies involved in the project along with WRAP and the Welsh Government. On 19 September, David Fitzsimons joined the latest meeting in Cardiff to contribute to the 'Resilient Manufacturing Networks: Forecasting informatics and holons' project led by Professor Aris Syntetos.
The circular economy framework sets a high-level goal but this project is designed to bore down into the detail of closed-loop supply chains and take-back systems. Take-back systems are growing rapidly, driven in part by internet sales that generate a percentage of returns that need to be valorised. The returns rates vary by product from up to 65% for some clothing brands to 10% for mattresses and 5% for some types of electrical products.
The systems established by companies such as Panalpina to valorise the returned products form a foundation on which to offer additional closed-loop services. But these services are not as straight forward as linear production models. The additional supply chain volatility needs to be understood so that mitigation measures can be proposed. The 'Forecasting informatics and holons' project is revealing the complexity of managing product returns. The modelling of this complexity should help to reduce costs and thereby deliver on the promise of the circular economy.