Measuring and eliminating the bullwhip in closed loop supply chains using control theory and Internet of Things

Abstract Closed-loop supply chains are complex systems as they involve the seamless backward and forward flow of products information. With advent e-commerce online shopping, there has been a growing interest in product returns associated impact on inventory variance bullwhip effect. In this paper, novel four-echelon closed-loop chain model is presented, where base-stock replenishment policies modelled by means proportional controller. A stochastic state-space implemented, initially to capture dynamics while analysed under stationarity conditions with aid covariance matrix. This allows effect be expressed function return rates. Next, an optimisation method introduced study Internet Things The results show that can reduce costs fluctuations eliminate chains.