Reverse Logistics - Creating Environment Friendly Enterprise

The business environment today is abuzz with a number of operational activities. The supply chain and logistics activities being the backbone of every enterprise  brings in  success through higher returns, profit margins, better customer service and loyal customers.  Nevertheless, the evolving business models as a result of globalization and technological enhancements are partnering changes in the supply chain activities of the enterprises.


The supply chain solutions of the modern day business are not just focused on the management of the raw materials and products from the manufacturer to the distributor but extends to see the satisfaction of the customers and end-users. This aspect brings in another angle to customer satisfaction and extends the supply chain process to reverse logistics. Referring to all operations involved in the reuse of products and materials, Wikipedia defines Reverse Logistics as "the process of planning, implementing, and controlling the efficient, cost effective flow of raw materials, in-process inventory, finished goods and related information from the point of consumption to the point of origin for the purpose of recapturing value or proper disposal”.


Reverse logistics today is a phase in the product's lifecycle. Also termed as Aftermarket supply chain this includes logistics, warehousing, repair, refurbishment, recycling, managing e-waste, call center support, reverse fulfillment, field service activities. The reverse logistics involves movement of  finished goods from  the customer or end-user to the manufacturer due manufacturing defects, warranty returns  or unsold inventory. With re-manufacturing, refurbishing and recycling included as a part of the reverse logistics planning, this aftermarket activity helps to understand customer requirements, recapture  value as well as saves on money and environmental resources by ensuring  proper disposal of unused goods.


Today the globalized enterprises  locate their  manufacturing units in area with lower labor costs, and warehouses  at places close to shipping zones so as to reduce the internal transportation costs. The movement of finished inventory or parts of finished goods thus involves a global supply chain. With reverse logistics facilitating effective returns management ,manufacturing enterprises can now pull out their products from areas of low demand to those with higher demands thus ensuring that all their products are sold irrespective of  the markets.


However, since reverse logistics is still a new concept being accepted slowly by the larger business population, not all supply chain solutions are ready to handle the returns. Nevertheless, leaders in the supply chain and logistics industry have designed integrated systems which will aid the returns process in an efficient manner. With the use of trusted returns management solutions they provide their clients speed, real-time visibility and efficiency in dealing with inbound product and help in minimizing volume of return inventory.


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