What Are Reverse Logistics And Why Do They Matter In Your Supply Chain?

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When you order a product for delivery, the management of the route that it takes — from its creation to its final stop on your doorstep — is referred to as logistics. Products make several stops along their way through the supply chain: they may end up in a storage warehouse, go through a packaging phase, and then spend weeks in the back of a heavy haul carrier truck.

 

Reverse logistics refers to what happens after that product arrives at the end consumer: how it could potentially be reused, how it should be disposed of after use, and any other way where an expired product can create value. Companies should be interested in how their reverse logistics affect their supply chain because returned products fall under their jurisdiction.

 

Flip It And Reverse It

Companies must handle returned items with care and consistency. They must:

  • Ensure the product gets shipped back to them correctly.
  • Test the quality to identify the flaw.
  • Document any problems.
  • Dissassemble, repair, recycle, or restock the item.

 

The main point of custom reverse logistics services to figure out why the product was returned — if errors were made, they need to be identified to prevent the same problem from occurring to future consumers.

 

In the end, reverse logistics offer several benefits: they can reduce costs because everything is planned out ahead of time; provide faster service which can help restore a customer’s faith in the brand; boost customer retention rates (the faster a problem is resolved, the more likely the customer is to stay with the company); and recover the loss of investment in your failed product by fixing and restocking the unit, scrapping it for parts, or repurposing it in a secondary market.

 

However, it can be hard to manage your reverse logistics workflow if you’re unfamiliar with the techniques, or are otherwise predisposed with projects and more dire areas of focus. Hiring a company to take care of the nuances of the process ensures that you’re getting the most bang for your custom reverse logistics services buck. Since Canada is expected to put around $2 billion into its transportation infrastructure — a key aspect of both traditional and reverse logistics — in the coming decade, it’s worth the time and money to figure out if your current reverse logistics workflow is effective for your company.

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