Vicious circles that hinder value creation in closed loop supply chains

Although both practitioners and academics acknowledge that recovering returned products and materials create value, many companies are still hesitant to scale up their closed loop supply chain (CLSC) activities as part of their core business. Literature provides much knowledge on success factors for CLSC activities, constraints and stakeholder of CLSC activities, yet fails to explain how these factors interact. We conduct an explanatory study collecting and analyzing in-depth data from four brand owners of high capital electronic goods. We find that CLSC key processes negatively interact with operational constraints creating a vicious circle that impedes brand owners to scale up their CLSC activities. Several strategic factors can relax constraints, yet these are hampered by conflicting stakeholder interests. Overcoming these constraints requires integral thinking and top-management commitment as well as collaboration among different stakeholder groups.