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Reverse logistics is a supply chain that is dedicated to the reverse flow of products and materials for return repair remanufacture, and or recycling.
It is the logistics process of removing new or used products from their initial point in supply chain. Such as returns from consumers ,over stocked inventory, or outdated merchandise and redistributing them using disposition management rules that will result maximized value tat the end off the items original useful life. A reverse logistics operation is considerably different from forward logistics. it must establish convenient collection point t to receive the used goods from final customer or remove assets from the supply chain so that more efficient use of inventory or material overall can be achieved.
Normally in the case of logistics the things moves from its manufacturers to customers but in reverse logistics It is opposite of logistics, things moves from the customer to manufacturers for proper disposal or reuse.
It means for all actions linked to the reuse of things and materials, that is the process of planning, implementation, and controlling the efficient, cost effective flow of raw material, in process of inventory,. For further defining the reveres logistics that is the aim of moving things to its original place to the place of manufacturers for its proper disposal, refurbishing, and remanufacturing activities. It may also be included the form of reverse logistics. The reverse logistics process is also including the sale of surplus and management as well as returning things or equipment and machines from the hardware leasing business.
Importance of reverse logistics.
Let say if nothing or products need to send backward the activity probably is not reveres logistics. It (reverse logistics) also includes processing returned merchandise due to damage seasonal inventory restock, recalls, and excess inventory. It also includes recycling programs, hazardous material programs, obsolete equipment disposition, and asset recovery. Reverse logistics is really important for any company or organization to improve its reverse logistics really effectively and probity. before that reverse logistics did not have much importance or they did not thinking about that R. logistics can be a good move towards the business profitability.
Reverse logistics included these objects.
- Damaged merchandise
- Seasonal inventory
- Hazardous material
- Obsolete equipment disposition
- Asset recovery
- Strategy for success
- According to Ryan Harrington a customers are most likely sophisticated in their purchasing power of decision. And environmental laws take root, now mostly retailers are seeking to improve or enhance their way of return system. Some of the companies have already turned their network into competitive advantage by taking an active position that increases value for customers and builds loyalty. Companies such as Eastman Kodak and Hewlett Packard have implemented successfully reuse and recycling programs.
- Companies now a days recovering their costs from raw material and packaging procurement, manufacturing, waste destroying and regulatory compliance.
- According to author there is one more way to improve strategy for reverse logistics when the retailers, vendors and logistics work as a team to reduce the percentage of returned products and improve return system flow.
- We need to realize return process and what the reason behind returning is and then develop detailed returns reporting.
- Major reason of return i.e. products were depicted wrongly in the catalog on your website, product quality or packaging is not good or simply customer choice.
- by developing with analysis your returns cost.
- try to analyze customers expectations in terms of speed for doing the returns and is credit using. how good you r dealing with customer regarding returns.
- If there is need for interaction are the employ less off the service customer friendly? Make sure the Vander will be able to do your operation. Because sometimes vendors hasn't done the work you giving him to do.
- Try to realize your requirement, functions business and metrics what kind of functions data you will looking from vendor. and what will you keep in house? Understand the complexities involve in recovering data from third party vendor for example ask them how often data shell be passed to you and what format and also how fatly and safely can the service import data for review?
Recognition of Reverse Logistics
It is really strait in the future, more companies are going to lavish considerable attention on revers logistics. Many of companies is now well aware about reverse logistics that how important is it to make their business profitable. And they are yet to realize the strategic importance that recerse logistics can play.
In future to bring the cost logistics down , firms will have to focus on improving their reverse logistics on different aspects of reverse logistics follows:
- Partial returns credit
- Faster processing /shorter cycle times
- Earlier disposition decisions
- Better data management
- Improved gatekeeping technology
There is one easy way to reduce the total cost of reverse logistics flow is that to reduce the volume of products that is asked to carry. It has two aspects to do. First , product that doesn't belong to in flow should prevent from entering. Second the product should be dispositioned as early as possible when the product has entered in the flow.