Understanding the concept of reverse logistics:

Reverse logistics is becoming a common practice in the aftermarket industries. So it is important to understand the term reverse logistics and the idea behind it.

What is reverse logistics?

This term is associated with all kinds of operations that are associated with the reuse of materials and products. This process involves planning, controlling the efficiency, implementing, the flow of raw materials in a cost-effective manner, finished goods, in-process inventory, and associated information from the point of its consumption till the point of its origin for the reason of proper disposal or recapturing value.

reverse logistics

To be more precise, it is the process of movement of goods from their usual final destination for the reason for proper disposal or to capture its value. Activities of refurbishing and remanufacturing are also included in reverse logistics. It is the management as well as the sale of additional as well as machines and equipment that are returned from the business of hardware leasing. Here the resource or the product goes back step in the supply chain. Here products are moving from the buyer to the manufacturer or distributor instead of coming to the consumer and hence it is getting the name reverse logistics.

In traditional logistics, a product reaches from the manufacturer to the customer or distributor. But if the product is having any defect then the customer would return it and the manufacturer would have to arrange for the shipping of this product and then test it, dismantle it and repair, dispose or recycle it. So the entire supply chain network is reversed in this case.

In the case of online shopping, this reverse logistics is becoming an increasingly common practice. Here the product might not be defective, but as the customer is seeing and feeling the product only after delivery there are increased chances of returns if the product does not meet customer expectations.