The first by stock 1992 recognized the field of reverse logistics as being relevant for business and society in. Reverse logistics is a small part of the total logistics of a company. The premise is the choice of reverse logistics for plastics on the one hand, considering their versatile applications, such as in the packaging, construction and automotive industries. Flow of surplus or unwanted material, goods, or equipment back to. Reverse supply also referred to as reverse logistics stands for all operations related to the reuse of products and materials. Managing reverse logistics is becoming an important element of supply chain management and, in some cases, a profit generating function. Reverse logistics is the flow of sold goods back to the company in the opposite direction of movement of the supply chain. Research executive summaries series tools to manage reverse logistics method the toolkit was developed through intensive interaction, workshopsindustrial forums each workshopindustrial forum was attended by on average 20 managers, with managers from. The way forward part i of ii although reverse logistics is often overlooked, retailers that master this discipline can gain competitive differentiation and turn the.
However, in reverse logistics, companies create a new supply chain network that works backwards, and allows consumers to reach. Activities such as demand planning, inventory management and transportation have proved to be essential to the achievement of. It incorporates planning, implementing and controlling the efficient costeffective flow of raw materials, inprocess inventory, finished goods and related. Visit payscale to research reverse logistics manager salaries by city, experience, skill, employer and more. Pdf reverse logistics in transportation jose antonio v. Summary this paper describes the state of the art of reverse logistics rl, highlighting the importance for the development of communities where there is no other possibility. Generally, logistics is known to be the process of transporting products from manufacturers to customers. Reverse logistics is a branch of asset recovery also by increasing customer loyalty. Reverse logistics is about the aftermarket ordinary logistics focuses on everything that happens prior to the sale and then between the sale and the point at which the customer has the product in hand. Input your email to sign up, or if you already have an account, log in here. However, the increased contemporary emphasis on reverse logistics appears to be the result of public policy and social marketing influences. Whatever parties are involved, the focus involves moving products forward from. Reverse logistics, dealing with the ph y sical flows of products, components and materials flowing from usersowners to reusers, i s a gro wing field both in practice and in the academic world.
More precisely, reverse logistics is the process of moving goods from their typical final destination for the purpose of capturing value, or proper disposal. Logistics is defined by the council of logistics management as. Earlier companies did not pay much attention to reverse logistics. Problems, challenges, and suggestions for reverse logistics. Then, we picture those completed goods moved to distributors or final consumers, or some similar combination. It is a process of flow of goods or material which are unwanted or defective through the logistics chains to the manufacturer so that it can be recycled, reused, or disposed of properly. Flow of surplus or unwanted material, goods, or equipment back to the firm, through its logistics chain, for reuse, recycling, or disposal. Mar 18, 2015 when it comes to opportunity costs and reverse logistics management, consider the example of expanding your repair operations to another country. Reverse logistics deals with the handling of the goods that are being returned to the manufacturer by the customer. It is the process of moving goods from their typical final destination for the purpose of capturing value, or proper disposal.
Therefore, they just focus on trying to reduce the cost of returns processing. Kroon and vrijens 1995 logistics management and the activities involved in the reduction, management and waste disposal and not disposed waste packaging and products. And in times like these, any help to maintaining the environment is greatly appreciated, worldwide. As consumers shift towards purchasing more items online rather than instore returns have increased due to buyers remorse, unmet expectations and improper product sizing. Reverse logistics is the process of planning, implementing and controlling the efficient, costeffective flow of raw materials, inprocess inventory, finished goods and related information from the point of consumption to the point of origin for the purpose of recapturing or creating value or for proper disposal. As consumers shift towards purchasing more items online rather than instore returns have increased due to buyers remorse. There is a lack of understanding of what is being returned and why. The ultimate goal of reverse logistics is to optimize or make more efficient aftermarket activity, thus saving money and environmental resources. Aug 21, 2017 a definition of reverse logistics with examples. However, the ability to recuperate assets and revenue in the supply chain is causing a refocus in this area. The different types of forward supply chain management include direct order fulfillment, hub services, pickandpack services, and shipping. Reverse logistics is any process that involves moving things from the customer back to the producer. The study also tries to look at the environmental aspects of reverse logistics. In short, reverse logistics needs to become a core competency.
The information based modern book logistics and the modern logistics center are doing a good favor to the book industry. In an instance, of reverse logistics, products move back from customers to distributors or manufacturers. The process of reverse logistics includes return policy administration, product recall protocols, repairs processing, product repackaging, parts management, recycling, product disposition management, maximizing liquidation values and much more. Reverse logistics definition according to several authors. A smart reverse logistics system can prevent the cost of processing returns that are not actually the responsibility of the manufacturer and prevent useless transportation before it begins.
When we talk about the traditional flow of logistics, we imagine the movement of raw materials to one or several manufacturers. It can quickly lose that value if the customer becomes dissatisfied. The process of planning, implementing, and controlling the efficient, cost effective flow of raw materials, inprocess inventory, finished goods and related information from the point of origin to the point of consumption for the. Reverse logistics is a strategy in supply chain management in which a company collects and reuses some part of their distributed good. Logistics engineering is a branch of systems engineering dedicated to the scientific organization of the purchase, transport, storage, distribution, and warehousing of materials and finished goods logistics is generally a cost centre service activity, but provides value via improved efficiency and customer satisfaction. However, now due to consumer awareness, law enforcement on disposal of certain goods makes it very important for companies to manage an efficient reverse logistics. Logistics grouping logistics functions in relation to selling products and services is a sign of the evolution of companies and their management thinking.
It typically involves returning a product to the manufacturer or distributor or forwarding it on for servicing, refurbishment or recycling. By partnering with us, you gain instant scale and agility in your reverse supply chain. The reverse logistics process includes the management and the sale of surplus as well as returned equipment and machines from the hardware leasing business. Recovering lost profits by improving reverse logistics 5 impacting the bottom line many executives compare the amount of money spent processing returns to other supply chain activities and conclude that investing resources elsewhere would yield greater results. Managing reverse logistics to improve supply chain. As a result, you need to have a dedicated reverse logistics strategy in place to deal with the sheer volume of returns, but each return also means your. Importance of reverse logistics supply chain minded. Reverse logistics programs are typically complicated by a number of factors. The function has been around since the phoenicians began shipping amphorae of wine to rome in 1,500 bc the movement of product invariably results in the. Reverse logistics is one of the least focused areas for many companies. When a company focuses more attention on the returned merchandise to figure out what the original problem was, customers will have a better experience. There is just too much at stake in terms of brand protection, sustainability requirements, and ultimately profitability. This is exacerbated by the multiple entities customer, manufacturer, reseller and disposer that need to partner to develop a smooth reverse logistics. Nov 02, 2005 a smart reverse logistics system can prevent the cost of processing returns that are not actually the responsibility of the manufacturer and prevent useless transportation before it begins.
In addition to these operational differences between forward and reverse supply systems, conceptual system is a system before firing, while the reverse system is both a pull and push krikke, 1998. Especially during the last decade, reverse logistics has obtained recognition both as a research field and as a practice. Activities associated with a productservice after the point of sale. Nowadays, companies are even getting iso certification for their returns process. Companies can see between 4% 30% of their products returned by customers and total uk retail returns have been valued at around. Reverse logistics management and green logistics management 818 words 3 pages. Reverse logistics an overview sciencedirect topics. The strategies followed in reverse logistics are disparate due to the type of skus being handled.
In this paper, reverse logistics activities and key reverse. Growing green concerns and advancement of green supply chain management. Logistics is a successful, costeffective planning, realization, and control of raw material, workin progress, final products, and connected information from the beginning to consumption, in order to perform consumers needs. Top content on examples and reverse logistics as selected by the supply chain brief community. Salary estimates are based on 3 salaries submitted anonymously to glassdoor by reverse logistics employees. Implies that goods and services flowing in the opposite direction to normal logistic activities. Reverse logistics is for all operations related to the reuse of products and materials. Then, based on figure s 3 and 5, from the book reverse logistics, we concluded the problems as follows. Reverse logistics companies can lower supply costs the reclamation of valuable parts, including oem parts, can be a source of supplies for future production in your company. In our experience with numerous retailers, reverse logistics remains an overlooked area.
Many companies move overseas, attracted by the lower labor rates but fail to fully consider the time and effort involved in setting up a repair center or finding a repair partner. Aug 22, 2016 reverse logistics is the set of activities that is conducted after the sale of a product to recapture value and end the products lifecycle. Problem s discussion in the book reverse logistics in china the mod ern logistics technique brings the book industry new development chance. Reverse logistics definition according several authors. Our senior management has collectively over 150 years of helping companies implement reverse logistics solutions, and weve already made the investments in people, technology, and processes. With forward logistics shipping, a sales forecast is used to project the requirement. An examination of reverse logistics practices request pdf. The practical insights offered here will help you develop that competency. However, for the purposes of this article, we will not be focusing on a general.
Reverse logistics is the process of receiving returned merchandise with the purpose of proper disposal or recapturing value. When a machine or piece of equipment reaches the end of its useful life, business owners can achieve a second. Traditional or forward logistics deals with the flow of products from the factory to the consumer. Research executive summaries series tools to manage reverse logistics overview of project reverse logistics has become an area that retailers and manufacturers cannot ignore. Paperwork and poor workflow processes tend to plague reverse logistics operations. Companies and their supply chain managers can no longer afford to treat reverse logistics as an afterthought. The circular economy isnt just a theoretical concept, it can be implemented, and is often much easier than one would think. Definition of reverse logistics reverse logistics consists of all activities which are performed after the sale of a product. Information and translations of reverse logistics in the most comprehensive dictionary definitions resource on the web. The reclamation of valuable parts, including oem parts, can be a source of supplies for future production in your company. Reverse logisticsthe movement of products back toward the manufacturer in a channel of distributionis a topic that has been given scant attention. Reverse logistics processes in plastics supply chains abstract. Reverse logistics is the process of handling return of products from a consumer or a retailer to a manufacturer through the use of the supply chain.
Filter by location to see reverse logistics salaries in your area. But what is reverse logistics, really, and how can you benefit from reverse logistic plans. Jul 10, 2017 reverse logistics is a strategy in supply chain management in which a company collects and reuses some part of their distributed good. Reverse logistics is the management of all the activities involved in the flow of goods, demand information and money in the opposite direction of the primary logistics flow, a reduction in the generation of waste, and the management of the collection, transport, disposal, and recycling of hazardous as well as nonhazardous waste in. Remanufacturing and refurbishing activities also may be included in the definition of reverse logistics. But wait, youre just sending a widget back how is that a challenge for. Browse examples and reverse logistics content selected by the supply chain brief community. The following are common types of reverse logistics. Mar 29, 20 but what is reverse logistics, really, and how can you benefit from reverse logistic plans. Reverse logistics also encompasses recycling of packaging and containers, reconditioning or refurbishing of products and disposition of obsolete goods.
Why reverse logistics needs to become a core competency. In its turn, business dictionary gives the following definition of reverse. The role of reverse logistics in creating added value for producers of plastics is presented here. A next definition contains both traditional and reverse logistics. This includes business processes that involve transport from distribution endpoints such as retail locations back in the supply chain to locations such as warehouses and factories. During the early nineties, the council of logistics management published two studies on reverse logistics. Understanding the difference between reverse logistics and. Reverse logistics is the process of moving goods from their typical final destination to another point, for the purpose of capturing value otherwise unavailable, or for the proper disposal of the products.
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