Turn Returned Product Back into Cash with Reverse Logistics
The APICS Dictionary defines Supply Chain Management as the “design, planning, execution, control, and monitoring of supply chain activities with the objective of creating net value, building a competitive infrastructure, leveraging worldwide logistics, synchronizing supply with demand and measuring performance globally." Thus SCM is concerned not only with the flow of finished goods from the point of manufacture to the point of consumption but also with the reverse flow of unsold and unwanted goods from the point of consumption to the point of origin for reuse, recycling or disposal. The forward flow of finished goods is referred to as forward logistics while the reverse flow of goods is referred to as Reverse Logistics. Thus reverse logistics is defined 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 is often considered as an expense or an additional financial burden to an organization. However, the fact of the matter is that it offers several tangible and intangible benefits to the organization. Here is a look at some of its benefits. * Improves Company Credibility and Reputation: as reverse logistics allow the enterprises to take care of e-waste and other hazardous waste, enterprises stand to gain a good standing of being a responsible company. * Reduce Costs: reverse logistics help to minimize overall costs by taking back unsold and unwanted goods back to the manufacturer so that it can be taken apart, sorted reassembled or recycled to be sold again in the market. * Improve Customer Satisfaction: reverse logistics help to improve customer satisfaction by taking back faulty goods back to the manufacturer for repair and replace it with a new one. * Gain More value: as unsold / unwanted / returned goods mean loss of time, money and effort, reverse logistics help in gaining more value by sending it back to the manufacturer for reuse or recycling. Considering the substantial positive effect reverse logistics can have on business, enterprise needs to partner with good third party logistics providers to manage product that comes back from the field. The following are some of the returns management capabilities of a 3rd party logistics provider. * Detrash and destruction of returned materials (CDs packaging materials etc.) * Date code based warranty assessment * Test diagnostics and repair * Software and/or firmware upgrades * Refurbishment * Repackaging * Warehousing and Distribution * Legally compliant disposal (i.e. WEEE and SB2050) * Web-based inquiry and reporting Thus, reverse logistics help to turn returned product back into cash quickly and with no hassle – all the while improving profitability and efficiency. Other Links - data center integration