Firms have begun to benchmark return operations with bestin-class operators. It has got a higher level of retention with greater customer service. Reverse logistics refer to monitoring the life-cycle of your products after they arrive at the end consumer. These numbers and facts confirm the importance of im plementing a Reverse Logistics network, to regulate and organize the increasing amount of waste. 2. The chief characteristics of this stage are coordination among several . The costs involved in it like transportation, administrative and aftermarket are also low. 4. The most important reason to adapt strategies of reverse logistics is because of its profitability. E-commerce companies and organisations who decide to implement their reverse logistics also establish agreements with courier companies or third-party logistics . This paper is aimed at introducing the concept of reverse logistics (RL) and its implications for supply chain management (SCM). In reality, reverse logistics costs are less than 4% of total supply chain costs for most companies. Logistics Makes your customers' experience better. Any logistics involved after the point of sale to recapture value and ensure proper disposal of the returned product, is called reverse logistics. Several experts considered the importance of logistics costs in health institutions, assessments Housley (1978) arrive at an estimate of 46% for North American hospitals [15]. A prime example of the importance of reverse logistics is evident during the . Reverse logistics is a strategy in supply chain management in which a company collects and reuses some part of their distributed good. (Tyler R. Morgan, Robert Glenn Richey Jr, Chad W. Autry, 2015) The reverse logistics should benefit from the key relationships formed within the context of reverse logistics collaboration, given the joint information sharing that occurs. The meaning of word Logistics in general business sense is the implementation of multifaceted operations, which consist of various processes such as production, material handling, packaging, inventory, transportation, warehousing, etc. Gartner Research says that about 70% of businesses plan to invest in the "circular economy." This circular economy . Trading partners have to work together to ensure that the reverse logistics process is But only 3% name it a key area for investment. Revising regularly for improvement. Many companies that, previously, did not devote much time or energy to the management and understanding of reverse logistics have begun to pay attention. According to Bras (1997) and Rose (2000), mainly four motivators, involving customers (stakeholders), competition, ISO 14001 system and the most important, legislations, make organizations and corporations more concerned about environment-friendly products and technologies on their own initiatives. There is yet another important extension to the supply chainprocess, known as reverse logistics.Simply put, reverse logistics is the procedure of dealing with processing, planning and the flow of the final finished productsinventory, packaging materials. In conventional systems of prospect logistics, the flow starts from the raw material provided by suppliers, then manufactured parts and components for assembly of the end product which . The process reduces costs, creates value, decreases risk and completes the product life cycle. reverse logistics and outlines some of the challenges, to be faced during the implementation. Improve corporate image and customer satisfaction. International organizations have sought to develop symposiums, Besides, it helps to educate consumers through . PDF. Overcoming Reverse Logistics Challenges through Logistics Centers 4.1. Every component of those strategiesfrom workforce . Toyin Adebayo. The reverse flow is different in a number of ways. Reverse logistics management for supply chains Download the PDF. Through recycling, parts of the product are recovered. It helps to calculate It includes recycling programs, hazardous programs, proper . Companies run RL activity generally due to government . Reverse logistics is very importance in view to customer satisfaction. The importance of reverse logistics practices inspired many manufacturers to design products which can be dismantled and regeneration, in the . Lack of information and technological systems Given the complexity of RL supply chains and the uncertainty return flows, effective information technology (IT) Reverse Logistics comes with various advantages which are listed below: 1). Read More. One of the major current concerns of society is the environmental issue, precisely because this is a prerogative of great importance for the populations in terms of quality of life. This could include how your product could potentially be reused, how it should be properly disposed of after use, and any other way where your expired product can create value. 75% of retailers identify reverse logistics as a crucial part of supply chain management. The concept of reverse logistics has gained immense popularity in the recent times. international journal of business and management studies vol 3, no 1, 2011 issn: 1309-8047 (online) 161 the importance of reverse logistics. Schematic representation of the direct and reverse logistics processes. Moreover, the researchers are realizing their responsibility to increase theoretical knowledge of reverse logistics operations in supply chain management. They usually emphasize on last-mile delivery, route planning and optimization, and order fulfillment. activities of the forward and reverse flows of products, information and services between the point of origin and the point of consumption. It is "the process of moving goods from their typical final destination for the purpose of capturing value, or proper disposal. and material. According a study conducted by Statista, businesses can expect to see a 36% increase in tangible cost savings. The meaning of Reverse Logistics. The features of reverse logistics are -. J. Grabara, M. Man, M. Kolcun. The benefits of reverse logistics involve increasing customer satisfaction and reducing the environmental impact and cost associated with customer returns. By this means, we put in context the driving forces for Reverse Logistics, a typology of return reasons, a . Reverse logistics is important because it maintains an efficient flow of goods. Tags: Reserve, Logistics, Importance, The importance of reverse logistics. the logistics steps involved in collecting, disassembling and processing used products, parts, materials and packages to provide an environmentally safe method of recovery. AER Worldwide mitigates risk and provides global solution to handle your entire end-of-life materials management . 2.1. Beckley and Logan (1948) were the first Satisfied customers are a business's most valuable asset. The goal of reverse logistics is to recapture value and ensure repeat customers. This white paper examines the Reverse Logistics Maturity Model and it's application in the lighting industry. . Companies whose products are subject to regeneration can save up to 60 % of the estimated cost of a completely new . and reverse logistics. 2. Navigating the rise in returns: Workforce implications of reverse logistics . 3. About AER Worldwide. The reverse logistics that directly impact supply chains the . It is the aim to create a sustainable company value using a balance of economic and environmental efficiency. The reverse logistics process is illustrated in Figure 1. It includes reverse distribution, which causes goods and information 1.2 Importance of Reverse Logistics Reverse logistics (RL) is becoming an important aspect of supply chain management. Ktphaneme Ekle . Reverse logistics (RL) is an activity intended to manage end-of-used or end-of-life products to be returned to the point of origin. Published 19 April 2014. Business. In simple words, in Traditional logistics, the goods are . A guide to reverse logistics, types and strategies: https://bit.ly/3uoyPER Reverse logistics is a type of supply chain management that moves goods from its . 1. There is no doubt about the fact that reverse logistics in the supply chain management of automobile industry is becoming important. Finally, great reverse logistics can minimize stress on equipment managers and give them more time to focus on strategy. Significance of Green Logistics 2.1 Importance of Green Logistics (2012) suggest that by monitoring the different stages in reverse Since the 1960s, interest in reverse logistics services has increased due to the value it provides for recovered materials as a tool focused on recycling waste and recovering value from used materials. What is a reverse supply chain? consumption, that were important to GKN to understand what happened with sideshafts in end-of-life vehicles or main reasons in case of substitutions. This practice will directly benefit society as a whole. Learn about the top 10 major importance of logistics management. It covers the return of damaged or unwanted goods and handling them in a way prescribed by management. 2.1 Reverse logistics Over the past decades, the field of reverse logistics has received attention more than ever before. Remanufacturing and refurbishing activities also may be included in the definition of reverse logistics." Growing green concerns and advancement of green supply . 3). Importance of Reverse Logistics in SCM 1. It entails more than the mere re-use of containers and the recycling of packaging materials. Importance of marketing logistics pdf logistics management, materials management, logistics of distribution, marketing logistics, By 1980s and 1990s, business logistics developed as an important area for corporate strategy of achieving competitive advantage. Reverse logistics play a significant role in the profitability of a warehouse that operates in the retail or e-commerce order fulfillment industry because it maximizes asset recovery, optimizes supply chain efficiency, reduces costs and improves customer experience. Domain: Source: Link to this page: Reverse logistics in supply chain management can trace where products have been sold; they may inspect these for quality control. creation the funds for development and bui lding the reverse distribution channels, organizing the logistics programs for sustainable development, increasing responsibility of producers for the whole product life cycle, a green" image as important marketing element, remanufacturing of machine parts, renovation in technology of packaging materials, Reverse Logistics . 4). Such a system can help save energy, time and cost of processing the recalled materials. Boost Business Profitability. There is also a Business Case excerpt that uses a real-life example of how controlling the final disposition of your items takes on even greater importance in this ecommerce focused retailer landscape that looks to continue to be dominated by Amazon for years to come. There are four important stages in Reverse Logistics: Collection is the first stage, where product types are selected and products are located, collected. This aftermarket activity involves activities like Refurbishment, Replacement, Remanufacturing, Scrap and even Excess inventory, etc. The importance of the reverse logistics process is also seen with courier companies as they play a significant role in building strong customer loyalty towards the company or the brand. And while maximizing efficiency is always important, reverse logistics can also provide a wide variety of opportunities for improvements, from customer service and returns processing to supplier relations and an unexpected revenue source. (Amanda Badenshorst). Inspection/ Sorting is the next stage which may be carried out either at the point/ time of collection itself or afterwards. It is the process of moving a product from the point of consumption to another point for the purpose of recapturing the remaining . The global social and economic upheaval makes it more important than ever for organizations to have a sound reverse Age of returns 1. 1.2 Object ive of the thesis PDF. The main purpose of logistics is the flow of goods or things from the point . 3. Any logistics involved after the point of sale to recapture value and ensure proper disposal of the returned product, is called reverse logistics. They provide the primary impetus for supply chains in all three phases: production, marketing, and logistics. Figure 1. However, in reverse logistics, companies create a new supply chain network that works backwards, and allows consumers to reach . In this context, reverse logistics is an important issue. Reverse logistics (RL) refers to a set of programs or competencies aimed at moving products in the reverse direction in the supply chain (i.e., from consumer to producer). Reverse logistics encompasses all operations related to the upstream movement of products and materials. Information. In this context, the purpose of this study is to examine the main drivers of reverse logistics (RL) activities which is a fairly new concept that emphasizes the environmental perspective of logistics. The best way to reduce returns is to understand the total cost of your returns and to make sure your reverse supply chain is optimized along with the rest of your supply chain. Check out this article to see more about the Benefits of Reverse Logistics. Managing logistics is extremely crucial as it helps the organisations to gain deep insights of the supply chain. Motivators of design for environment-friendly reverse logistics. International Journal of Research in Business and Social Science (2147- 4478) 2022. We start by giving an understanding framework of Reverse Logistics: the why-what-how. Business. It also describes how Philips . that organizations implement new or refresh existing holistic reverse logistics strategies to reflect the increased importance of the capability. Part of the research charter was to determine the extent of reverse logistics activity in the United States . Setting up reverse logistics provides companies with the following advantages: Minimise the environmental impact. %0 International Journal of Business and Management Studies THE IMPORTANCE OF REVERSE LOGISTICS %A Gldem Elmas , Fevzi Erdomu %T THE IMPORTANCE OF REVERSE LOGISTICS %D 2011 %J International Journal of Business and Management Studies %P -1309-8047 %V 3 %N 1 %R %U : ISNAD: Elmas, Gldem , Erdomu, Fevzi . Reverse logistics refers to the logistic management skills and activities involved in reducing, managing and disposing of hazardous or non-hazardous waste from packaging and products. management (reverse logistics) provider to the recipi ent (patients ), taking into account the trajectories of the patients . International Letters of Social and Humanistic Sciences. It's the series of activities required to retrieve a used product from a customer and either dispose of it or reuse it. According Henning (1980) by taking a And for a growing number of manufacturers . First, product arrives whenever customers decide to return an unwanted item, or a retailer decides to pull slow-moving product, or a manufacturer institutes a packaging change, or any number of other possible causes. The importance of reverse logistics is that it ensures profits are . This aftermarket activity involves activities like Refurbishment, Replacement, Remanufacturing, Scrap and even Excess inventory, etc. Introduction According to Baenas, Castro, Battistelle and Junior (2011), reverse logistics has become an important topic within the domain of supply chain management in the recent times. RL is a research area focused on the management of the recovery of . It covers all the activities that determine the fate of these returned goods. The purpose of this paper remains to introduce the importance of reverse logistics in the domain of supply chain management, largely focusing over the automobile industry. Logistics Concept, Evolution, Objectives and Elements. Data was gathered from 223 online shoppers and the data was analyzed using. Reverse logistics provides companies with revenues and strategic benefits. Reverse Logistics report, 2018 Many retailers and manufacturers ignore the importance of reverse logistics. Source: Lacerda (2002) According to Dornier; Ernst (2000), reverse logistics involves the return flow, considering either defective parts / packages or products returned / consumed that should go to a recycling Supply chain management with a well-thought reverse logistics system engineered into it can help build an action plan for the defective or recalled products. In the literature, there are a number of research studies, that relate to these factors and . The transport process is one of the important activities in reverse logistics; and it is defined as the actual movement of mechanisms, goods, and resources from one point to another point within the reverse logistics network. What's your best reverse logistics tip? Reverse logistics Managed Services Reverse logistics in the circular economy Along with design, collaboration, and business models, reverse logistics plays a critical role in the circular economy. This "end-to-start", or inverse process was called reverse logistics by Luttwak (1971), and today is part of some authors described like a trend that is the reverse supply chain, where . Typically, a supply chain network creates a path for companies to reach consumers. The use of information technology is playing important role in today's reverse logistics. Second, the product is not all in new condition. Firms have begun to benchmark return operations with bestin-class operators. Returns and exchanges Sometimes, for any number of reasons, a customer will need to return or exchange an item.Return rates vary by niche or industry, and for some businesses returns are very common.. Chapter 1: Size and Importance of Reverse Logistics 1.1 Importance of Reverse Logistics Research Scope This project intends to define the state of the art in reverse logistics, and to determine trends and best reverse logistics practices. The drivers of change are increased competition and globalization. Many companies that, previously, did not devote much time or energy to the management and understanding of reverse logistics have begun to pay attention. 2). logistics activities in a single facility is more economic and efficient than several smaller intermodal terminals. The operation of inventory management determines the efficiency of storage of products. Location and distribution is the critical stage of . Reverse logistics is a small part of the total logistics of a company. Importance of Reverse Logistics, Reverse Supply Chain 1. RL deals with the returned, unused, products or unused raw materials in a reverse channel of distribution which is called reverse flow. According to the National Retail Federation, the total rate of returns was 16.6% in 2021, up from 10.6% in 2020. Reverse logistics COVID-19: Escalating logistics pain points Adding to traditional reverse logistics challenges, retailers are now operating within a state of continuous disruption driven by the COVID-19 pandemic. Reverse Logistics: "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 to recapture value or proper disposal.". All of these other aspects of asset recovery lead to the same place; decreased expenses and increased revenues. The success of reverse logistics depends on encompassing the entire supply chain. 1.2 Importance of Reverse Logistics Reverse logistics (RL) is becoming an important aspect of supply chain management. Reverse logistics basically means the reutilization of products and materials. The study evaluates the effect of reverse logistics operational responsiveness on customer satisfaction in retailing. It comes with higher service market share. Importance of Reverse Logistics to Your Business. The benefits of reverse logistics. The first hypothesis is firm collaboration will be positively associated with a reverse logistics competency. As the name implies, reverse logistics is focused on moving goods and materials backwards through a supply chain. Reuse of materials in manufacturing processes helps stave off the misuse of unprocessed raw materials and requires less power. Reverse logistics deals with the handling of the goods that are being returned to the manufacturer by the customer. It has the ability to improve the operational excellence which is necessary to grow and expand your business. It is estimated that thirty percent of ecommerce purchases are returned, as compared to less than ten percent of in-store purchases. The progress in techniques and management principles improves the moving load, delivery speed, service quality, operation costs, the usage of facilities and energy saving. But at the same time biggest problem for organizations and supply chains is reducing reverse logistic cost. Pienaar et al. These refurbished products can be sold at a lower price, minimizing the risk of loss which otherwise . Importance of Reverse Logistics. Understanding the "Amazon Effect" on Reverse Logistics As a result, it is critical for each company owner to have a thorough understanding of . This thesis tries to understand the basic concepts of reverse . 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