Reverse Logistics

What is reverse logistics?

Have you ever wondered how to best manage all articles or items customers might return to your business after purchasing? Customers regularly want to return products for reasons including defects, damage in transit, fit and many more. Companies must manage costs, inventory and customer relationships for product returns and adopting a logistics approach is the first place to start. One of such approaches is reverse logistics which is a supply management practice for moving products from customers back to the sellers or suppliers. Using reverse logistics enables businesses to regain value from returned goods by recycling, refurbishing or reselling them according to how companies make choices for repurposing products. Unlike traditional logistics that get products from suppliers to distributors to consumers, reverse logistics start at the consumer and move in the opposite direction along the supply chain. Netsuite provides a guide on reverse logistics that will be further discussed in this guide and can offer more information for your business.

Examples and types of reverse logistics 

Retailers like Home Depot, Levi Strauss and Kohl use reverse logistics to repurpose returned goods into new inputs or product lines while enhancing customer relationships in the process. Manufacturing and healthcare companies also adopt reverse logistics practices to refurbish, repair and remanufacture goods consumers find defective or outdated. There are different types of reverse logistics that businesses can explore. These are also known as reverse logistics components which focus on policies, procedures and management strategies for reusing products that are returned, unsold, damaged or reached end of life or contractual terms.

Why do reverse logistics matter for my business?

Managing returned items by customers can often cause strains because of unplanned costs that arise for hiring extra staff, return shipping costs and increased overhead. To offset costs involved in returns, reverse logistics stand as a value generation strategy companies can purse to recoup losses. Reverse logistics can offer a way for your business to maintain an efficient flow of goods while reducing supply chain management costs and building consumer trust. By adopting reverse logistics, you can seize additional benefits to your business from customer satisfaction and retention, improved brand sentiment, waste reduction and greater sustainability.

How can I get started with reverse logistics?

Business support organizations such as chambers of commerce and industry associations may have relevant resources to help you get started with using reverse logistics as part of your business practices. By searching on the internet, you can also find a number of guides, training manuals and materials on reverse logistics. Some examples are listed as follows

  • A Guide to Reverse Logistics: Netsuite offers a holistic guide with practical steps and strategy approaches you can explore to start considering reverse logistics for your business. Visit the Netsuite website.
  • Reverse logistics articles: DCL provides brief insights on how reverse logistics and other business strategies can help companies overcome challenges from managing returned products in different contexts. Visit the DCL website.
  • Couse on Introduction to Supply Chain Management: The International Trade Centre (ITC) offers a free-of-charge online course that can introduce your businesses to supply chain management tools and strategies for adopting reverse logistics. Link to the ITC website.