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Reverse Logistics Explained

        posted by , May 31, 2013

What is it?

Reverse logistics is the process of moving goods from the end customer backwards through a supply chain.

Common reverse logistics scenarios include returns, surpluses, trade-ins and disposals.

Definition: Reverse Logistics

Reverse Logistics is the process of moving goods from the end customer back to suppliers or waste processing facilities. The goal is to capture value from returns and surpluses or handle waste disposal to achieve sustainability targets.

So What?

Goods normally flow both ways in any supply chain.

If your business requires logistics you typically require reverse logistics too.

Reverse logistics supports the following business scenarios:

  • Customer Returns
    Handling customer returns is an essential part of the customer experience.

  • Surplus Returns
    Handling surplus goods in your extended supply chain.

  • Trade-in Programs
    Trade-in programs are a strategy to improve sales results by encouraging customers to upgrade. In many cases, these programs have sustainability benefits.

  • Disposal Programs
    Disposal of unwanted goods may have economic and sustainability advantages. In some cases, it's mandated by law.

Reverse logistics rarely returns goods to their point of origin. In many cases, returned goods and surplus goods are processed (e.g. tested, repackaged) and moved forward in the supply chain.

Trade-in and disposals may be refurbished, repaired, dismantled for parts, recycled for materials or disposed.

Next: Supply Chain Explained

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