Logistics or Forward logistics
Traditionally a product is developed or manufactured and goes through the supply chain (manufacturer-wholesaler-retailer) to be finally sold to a customer. We simply call this forward movement of goods from the producer to the consumer as forward logistics process.
What if the customer return the products or customer gets an damaged product?, the only way is take the reverse gear and take the backward direction, there is the importance of reverse logistics.
Importance of Reverse logistics
Today’s supply chains are steadily integrating more activities than those concerned with supply alone, like including service and product recovery. We can call this recovery phase as reverse logistics. Several forces drive reverse logistics, like, competition and marketing motives, direct economic motives and concerns with the environment.
Reverse logistics & its definition
Reverse logistics is the collection of all processes that come into play for goods that move in the reverse direction, i.e., from the customer to the business. This is the reverse of the traditional supply chain movement of goods from vendor to customer.
Reasons for Reverse Logistics
Reverse logistics is as important as Forward logistics. Products, components, materials, equipment and even complete technical systems may go backwards in the supply chain. It may be the products being reworked during manufacturing due to, Warranty returns, Damaged product, Wrong product, Delay in delivery, Order cancellation, Wrong documentation, Custom clearance problem, Retail over stock, Green Factor, Installation or usage problems, Dissatisfaction of the customers and many other reasons as follows.
Activities involved in Reverse logistics
The activities involved in reverse logistics is same as forward logistics but in a reverse order manner and the activities are collection, Inspection sorting, Re-processing and Redistribution.
The collection process involves bringing the products from the customer to the point of recovery. Inspection sorting involves sorting of the products according to the quality state and recovery route. As the name itself it’s Reprocessing, it includes the major activities such as Repair, Refurbishing, Remanufacturing, Recycling and Incineration and Redistribution is the process of bringing of recovered goods to the new users.
Scope of Reverse Logistics
Reverse logistics though considered as a drain on company profits, in today’s competitive markets, more and more manufacturing firms are planning of incorporating the reverse logistics system in their supply chain process for following reasons Growing concern of environment pollution, government regulations on product recycling and waste disposal, growing consumerism and stiff competition.