Reverse logistics
This article has multiple issues. Please help improve it or discuss these issues on the talk page. (Learn how and when to remove these template messages)
|
Part of a series on |
Research |
---|
Philosophy portal |
Reverse logistics encompasses all operations related to the upstream movement of products and materials.
Today, the global reverse logistics supply chain is valued at $415.20 billion and it is projected to reach over $600 billion by 2025. As of 2023, the global reverse logistics market is estimated to be worth approximately $993.28 billion. This value is projected to increase at a compound annual growth rate (CAGR) of 10.34% from 2023 to 2032.[8]
Business implications
In today's marketplace, many retailers treat merchandise returns as individual, disjointed transactions.
Reverse logistics is more than just returns management, it is "activities related to returns avoidance, gatekeeping, disposal, and all other
Reverse logistics research has also found that 84.6 percent of companies in the United States use the secondary market and 70 percent see the secondary market as a "competitive advantage."[18]
A Taiwanese research paper suggests three influential factors that drive the need for Reverse Logistics in businesses: economic needs, environmental needs, and social needs. The study, who polled 12 environmental management experts from Taiwanese electronic firms, found that Economic needs are most important with an importance weight of 0.4842, followed by Environmental needs with an importance weight of 0.3728, while Social needs are relatively unimportant with a importance weight of 0.1430.[19]
While the economic need is caused by a company's desire to profit off of the recovery value such as in the US, the Taiwanese study reasons that the importance of Eevironmental needs is due to the concern for waste management shared by the developed countries ,such as the countries of the EU, Japan, and the US. For example, in the EU, there exists the "Waste Electronics and Electrical Equipment (WEEE) dDirective, which makes EU producers responsible for collection, treatment, recycling, and recovery of all WEEE,; the"Restriction of the Use of Certain Hazardous Substance sin Electrical and Electronic Equipment dDirective, which restricts the use of toxic materials in electronics, and "the Eco-dDsign Requirements for Energy-uUing Products dDirective, which encourage sthe recycling of electronic products.[19]
Return of unsold goods
In certain industries, goods are distributed to downstream members in the supply chain with the understanding that the goods may be returned for credit if they are not sold e.g., newspapers and magazines. This acts as an incentive for downstream members to carry more stock, because the risk of obsolescence is borne by the upstream supply chain members. However, there is also a distinct risk attached to this logistics concept. The downstream member in the supply chain might exploit the situation by ordering more stock than is required and returning large volumes. In this way, the downstream partner is able to offer high level of service without carrying the risks associated with large inventories. The supplier effectively finances the inventory for the downstream member. It is therefore important to analyze customers’ accounts for hidden costs.[citation needed]
Reusable packaging
Reusable packaging systems require a closed-loop logistics system.[citation needed] Examples include reusable pallets, bulk boxes such as Euro containers, reusable bottles for milk, soda, and beer, compressed gas cylinders, beer kegs, etc.[20]
Refusal of the products in the cash on delivery (COD)
In case of e-commerce business, many websites offer the flexibility of cash on delivery (COD) to their customers. Sometimes customers refuse the product at the time of delivery, as there is no commitment to take the product. Then the logistics service provider follows the process of reverse logistics on the refused cargo. It is also known as Return to Origin (RTO). In this process, the e-commerce company adds the refused cargo to its inventory stock again, after proper quality checks per the company's rules.[21]
References
- ^ NetSuite.com (14 January 2021). "A Guide to Reverse Logistics". Oracle NetSuite. Retrieved 2022-07-05.
- ^ Hawks, Karen. "What is Reverse Logistics?", Reverse Logistics Magazine, Winter/Spring 2006.
- ^ Srivastava, Samir K. "Network Design for Reverse Logistics", Omega, 2008, 36(4), 535-548.
- ^ James R. Stock, Reverse Logistics (Oak Brook, IL: Council of Logistics Management, 1992)
- ^ James R. Stock, Development and Implementation of Reverse Logistics Programs (Oak Brook, IL: Council of Logistics Management, 1998)
- ^ Dale S. Rogers and Ronald S. Tibben-Lembke, Going Backwards: Reverse Logistics Trends and Practices (Reno, NV: Reverse Logistics Executive Council, 1999)
- ^ Rengel, P. & Seydl, C. (May 2002). Completing the Supply Chain Model at seydl.at. Retrieved on 2019-07-28.
- ^ "Topic: Reverse logistics". GlobalNewsWire (Press release). 11 April 2023. Retrieved 2023-06-09.
- ^ "The benefits of efficient reverse logistics". Airpharm. Retrieved 2022-10-31.
- ^ Harrington, Ryan. "Reverse Logistics: Customer Satisfaction, Environment Key to Success in the 21st Century", Reverse Logistics Magazine. Winter/Spring 2006.
- ^ Greer, 2004
- ^ Rogers, 2002
- , retrieved 2008-05-05
- ^ Srivastava, Samir K. "Value Recovery Network Design for Product Returns", International Journal of Physical Distribution and Logistics Management, 2008, 38(4), 311-331.
- ^ Madaan, J. & Wadhwa, S. (2007) Flexible Process Planning Approaches for Sustainable Decisions in Reverse Logistics System, Global Journal of Flexible Systems Management. Vol. 8, No. 4. p. 1-8
- ^ Panjehfouladgaran, Hamidreza; Lim, Stanley Frederick W.T. (2020). "Reverse logistics risk management: identification, clustering and risk mitigation strategies". Management Decision. 58 (7): 1449–1474 – via Emerald.
- ^ "Number Of Packages Returned Expected To Peak Before Christmas, Reflecting E-Commerce Shift". UPS Pressroom. Retrieved 2020-08-28.
- ^ Reverse Logistics Sustainability Council. "Secondary Market Research". Retrieved 9 August 2018.
- ^ ISSN 1877-0428.
- S2CID 235861717. Retrieved 7 May 2023.
- ^ Vogt, J J; Pienaar, W J; de Wit, P W C (2002). Business Logistics & Management - Theory and Practice. OXFORD. p. 236.