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Returns and reverse logistics

Returns and returns logistics go hand in hand. It is a tradition to return a product as it is to buy or receive it. Just as companies must do everything in their power to get their products on store shelves, so they must ensure a smooth process when some of these goods inevitably return in the opposite direction. When a consumer brings a product back to the store or sends it back to the retailer, an effective reverse logistics strategy means that returns won’t cause too much additional pain for businesses when their goods enter the supply chain again.

What does the reverse logistics process look like?

Unlike inbound and outbound logistics, the reverse logistics process involves the return of goods to their origin for repackaging, repair and / or redistribution – or for disposal. In other words, reverse logistics takes the traditional direction of the goods – facing the consumer – and inverts them. Although, in some scenarios, the product may eventually reach a different consumer. The reverse logistics process may differ from industry to industry, but the essence of it is something like this:

  1. The customer returns the product
  2. The return is processed by the seller
  3. The return is sent back to the manufacturer
  4. The manufacturer determines the status of the product
  5. The product is repackaged immediately – or the product is sent for repair / refurbishment – or the product is disposed of / recycled
  6. In the event of repackaging or repair / renovation, the product is again sold to the consumer

Having an efficient reverse logistics system reduces manufacturer, retailer and consumer stress and increases the likelihood of returning customers.

What is an example of reverse logistics?

The most frequently considered example of reverse logistics is the consumer return. But the reverse logistics process is more than that as it includes things like recycling, repairing, refurbishing and more. An example of reverse logistics is the return by the consumer to the store of a toy which he deems defective. The store then processes the return and sends it back to the manufacturer. The manufacturer then evaluates the item and concludes that it is repairable. The manufacturer then sends the product back for overhaul. Finally, after refurbishment and repackaging, the toy can be sold directly to another consumer by the manufacturer or retailer.

Why do we return the goods?

There are many reasons why we return goods. After the holidays, people often return gifts they don’t want. However, during the year, returns can occur due to product defects, incorrect product size / fit, consumer finding a better price elsewhere, product no longer needed, a more abstract concept of buyer’s remorse, or no specific reason at all. In addition to direct consumer returns, a retailer can also return unsold goods to the manufacturer / distributor for credit. In most of these cases, the products start the reverse logistics process.

Do you have questions about reverse logistics?

Have more questions on reverse logistics, inbound logistics, outbound logistics, or anything else for freight and logistics? Just let us know! We will be happy to contact you to discuss your company’s unique needs and help you with any transport and logistics challenges.

Are you looking for information on other topics related to transport and logistics? Take a look at our Learning Center. Here are a few pages to help you get started:

  • Domestic transport: Intermodal, Truck, LTL
  • External solutions in the field of transport management services

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