And for a growing number of manufacturers, in industries ranging from carpets to computers, reverse supply chains are becoming an essential part of business. For instance, Kodak remanufactures its single-use cameras after the film has been developed. Companies should consider not only the costs for shipping and storing but also how quickly the value of the returned products will decline and the need for control over the products. With both forward and reverse logistics in place, your supply chain system will become more transparent throughout the entire network. The post Reverse … Companies often will need to work closely with retailers and other distributors to coordinate collection. Distribution of a COVID-19 vaccine will soon be the biggest supply chain challenge facing the world. Otherwise, companies may find themselves flooded with returned products of such variable quality that efficient remanufacturing is impossible. The rise in e-commerce transactions, as well as flexible return policies and strict environmental regulations, are shifting the focus of companies to their reverse supply chain. The majority of companies in the food industry don’t have the resources needed to set up a reverse supply chain in order to reuse packaging materials, separate undamaged products from damaged products in a load, or repurpose unsold food for animal feed or … When it comes to supply chain management, RL holds a rather strategic position in its design and development. JULY 28, 2020. Supply chain executives measure the effectiveness of that flow using the on-time delivery (OTD) metric. "As the supply chain assumes a more important role in a business enterprise, companies are scrutinizing logistics costs to eliminate redundancies, and returns. inherent challenges that a reverse supply chain faces, such as managing customer expectations on returns policies, partnering with other players in the supply chain and handling the mounting pressure from regulatory authorities. Clearly, more companies need to go back to basics and ask what is reverse logistics’ role in the top trends of the supply chain? Reverse Logistics Supply Chain reverse logistics technologySupply chains face an ongoing crisis with the threat of rising demands across consumers and business-to -business purchasers. The company may, for example, want to target customers who cannot afford the new products but who would jump at the chance to buy used versions at lower prices. But the process can be streamlined if a company subjects the returns to quality standards and uses sensors, bar codes, and other technologies to automate tracking and testing. Automatic consolidation of data from partners and systems. Copyright © 2020 Harvard Business School Publishing. Key insights about reverse logistics process flow, 3PL companies, supply chain management, transportation and logistics, and logistics analytics are covered in this blog. … For instance, Kodak remanufactures its single-use cameras after the film has been developed. We get it - sometimes it comes down to “Buy or Build”. Your entire supply chain will benefit from partnering with XPO. Improved reverse supply chain visibility, increased productivity, and greater responsiveness to customers. All rights reserved. For many organizations, reverse logistics is a daunting task. %PDF-1.5 %âãÏÓ These processes can include repair, warranty recovery, redistribution, value recovery, end-of-life recycling or any combination of these activities. Yin Wei . And therefore, it becomes even more interesting to understand the practical details of this process. 106 0 obj <]/Info 81 0 R/Filter/FlateDecode/W[1 3 1]/Index[82 39]/DecodeParms<>/Size 121/Prev 542227/Type/XRef>>stream The process for how a company handles that product is an example of reverse logistics. With plenty of companies, supply management success is calculated only up until the product is delivered to the end-user. Whether a company is establishing a reverse supply chain by choice or necessity, it will face many challenges. Supply Chain Logistics Solutions From e-commerce in the virtual space to traditional brick and mortar - our suite of logistics services is comprehensive. Reverse Logistics is as important to a business’s bottom-line as the usual management of procurement, logistics and spend analysis. The following are common types of reverse logistics. Whether a company is establishing a reverse supply chain by choice or necessity, it will face many challenges. Reverse Supply Chain / Reverse Logistics Definition. NEW DELHI: With the nationwide lockdown disrupting the dispatch of goods by FMCG companies and suppliers, some retailers have resorted to the reverse supply chain mechanism as a stop-gap procurement arrangement. This will ensure to the better management and control of all the stages of waste handling process. Thus, reverse logistics is important for use in advanced green supply chain management concepts and practices. Major hurdles for supply chain managers For example, they make product design and manufacturing decisions with eventual recycling and reconditioning in mind. Even with reverse supply chains, forward thinking pays big dividends. Effective Reverse Supply Chains With creating the product being only a small portion of the business, many businesses invest time into making methods for an effective supply chain . xÚÔUÛn7ı>ÚÜåuH�Y�mulDi\”àÃFb¡ºAZÑß÷WvÜ4®ıZ@ÔPœáápæJI/¤P2…�ŒB“JIa”�UÂk¸•†�°FÇë–cyâø‘P ¡_ŒoˆLÍh8. It is "the process of moving goods from their typical final destination for the purpose of capturing value, or proper disposal. In some cases, companies are being forced to set up reverse supply chains because of environmental regulations or consumer pressures. In addition, the forward and reverse flow of materials, information, human resources, and finance occurs among different stakeholders in closing the loop of supply chains. California Management Review, Vol. Basically, reverse logistics in the supply chain revolves around dealing with end-of-life, malfunctioning, or hardware upgrades. *Isi artikel merupakan pemikiran penulis dan tidak selalu mencerminkan pemikiran atau pandangan resmi Supply Chain Indonesia. Thankfully, today we have the right technological support in place to help us sail through many of these hurdles. In addition, overall efficiency for supply chain related processes was improved by approximately 15 percent. Supply chain and logistics news. Aberdeen's research identifies senior-level oversight as "the top strategy for improving reverse logistics" among best-in-class companies, with 92 percent having a senior service director or executive that oversees all aspects of the return, exchange, repair and refurbishment of products and parts. In many cases, it will make sense to outsource the logistics to a specialist. Reverse Supply Chain vs. Distribution and Sales. Reverse logistics is for all operations related to the reuse of products and materials. In recent years, your company has probably spent a lot of time and money fine-tuning its supply chain. Reverse Logistics. Reverse logistics is the term used to describe the way a company handles products that get shipped backwards through the supply chain. An often missed and a key area is the reverse supply chain (reverse logistics). Top companies for reverse logistics at VentureRadar with Innovation Scores, Core Health Signals and more. That can eliminate many logistics costs and get remanufactured products to market faster. In general, a business should seek to make disposition decisions—based on quality, product configuration, or other variables—at the earliest possible stage in the returns process. Better Reverse Supply Chain Process Transparency. Online ordering has been made a simple, one-click process. Tell us your most challenging logistic requirements, and we'll engineer sophisticated solutions using our intelligent technologies. The company has made their supply chain work for them with fewer links in the chain, strategic vendor partnerships, a cross-docking inventory tactic, and technology innovations to cut costs. Inspection and Disposition. Reverse Supply Chain Management -explore the feasibility to incorporate forward supply chain strategy into the reverse supply chain in the electronic industry . Dabei wird die Übersetzung des englischen Begriffs unterschiedlich verstanden und verschiedene Denkschulen konkurrieren miteinander. Unter der Bezeichnung Reverse Logistik (englisch Reverse Logistics) oder auf Deutsch Rückführungslogistik, Umkehrlogistik, Rücknahmelogistik werden alle logistischen Prozesse betrachtet, bei denen Güter vom (End-)Kunden ausgehen und wieder in der Lieferkette zurück laufen. The Supply Chain Minded community aims to inform and connect professionals active in Supply Chain, Purchasing, Manufacturing, Warehousing, Transport, Distribution; Reverse Logistics, Service Logistics, Lean & Six Sigma, 3PL. As Supply Chain Activities are evolving and partnering changes in business models, the focus and activities are not restricted to the management of raw materials and finished goods from point of origin from the vendors to plants and further on to the end customers. Effective and efficient reverse supply chain implementation may help in managing these returns along with the end of life product returns. Finally, some companies are using reverse supply chains as integral parts of new businesses. Including Returnly.com, LogiNext, Optoro etc While the reverse supply chain is an appraoch that is yet to be addressed by many manufacturers, a growing number of companies are looking for external support to help them implement reverse logistics processes. It’s the series of activities required to retrieve a used product from a customer and either dispose of it or reuse it. A reverse logistics supply chain management strategy is critical to maintaining healthy inventory turn and operating expenses. This is the reverse It is "the process of moving goods from their typical final destination for the purpose of capturing value, or proper disposal. A rather complex process, reverse logistics is the exact opposite of forward logistics. These processes are clearly mentioned in the With a new demand-planning and sourcing infrastructure in place, ModusLink focused on improving customer service levels within the client’s after market repair-service business by driving process efficiency and distribution improvements. Unfortunately, this doesn’t always account for all situations. Reverse supply (also referred to as reverse logistics) stands for all operations related to the reuse of products and materials. The quality, quantity, and timing of product returns need to be carefully managed. Although benefits are received when new technology is added to a product, the surplus of earlier product remains stagnant or left in storage… costing a company valuable space and loss of funds. Reverse Supply Chain / Reverse Logistics Web Resources * Reverse Supply Chain / Reverse Logistics Print Resources * Reverse Supply Chain / Reverse Logistics References (4 of up to 20) * Blackburn, J., Guide, V., Souza, G. and Wassenhove, L. (2004) Reverse Supply Chains for Commercial Returns. ModusLink continuously monitors the supply levels of all these elements at the PC manufacturer’s central European hub and replenishes stock on a daily basis to ensure that consistent inventory levels are always on hand to meet the forecasted demand. Reverse supply chain refers to the movement of goods from customer to vendor. Reverse logistics has become even more important with the arrival of the e-commerce era. Transparency in supply chain operations across your network. There is no one “best” design for a reverse logistics network; each has to be tailored to the products involved and the economics of their reuse. Rite Aid has a partnership arrangement with Inmar to assist in these areas as their 3PL. Yes, improvements within the supply chain can have a positive ROI, but the only way to ensure an organization understands actual savings versus projected savings lies in letting machine learning delve further into the information and consider everything. "So we often are working with the same companies on both their forward and reverse supply chains." The majority are handled by Genco (which Fedex recently acquired). This text provides general information. xÚb```¢LVÉıB ÄÀeaàXÈ ÉàĞx‘ß©€�áRâj¾†�s3²3;'€T)]c;¶ëæ75Ë…_€,�-f¦×8Ú×®Ûᦛؗ{€�£ƒ�Á£££�¡£�9££ƒ�ˆÅ2€üĞ�tS�ª1°Ç i1 –ÙÀ¸‰A€A�É›áC>S;£#£*c£)Ã3†,�å‚e\*9ÚÕÜÖ;¬ıÖùœ§˜õÛ?¦kP�h3°7>Ä«€X��ÃÙÂg\` @ These entities can offer flexible capacity, expertise in the regulatory environment, and the technology support to take on the complexity of handling multi-SKU reverse logistics. Whether your company establishes a reverse supply chain in-house or coordinates with an external provider, there are several benefits it can offer, including the ability to: Mitigate your losses: As a business, you want to maximize your profits and decrease your losses, and you can do that with industry-best reverse supply chain management practices. Gain scale & agility in your reverse supply chain. Adopting an excellent method for your reverse supply chain creates ways to deposit … 120 0 obj <>stream Reverse Logistics and Supply Chain Challenges. In addition, for many organizations, reverse logistics (also known as returns management) can represent a significant source of untapped profitability. The choices in the supply chain are endless for company owners such as routes, item manufacturing or which provider to use to manage the entire pipeline. The solution for developing a reverse supply chain is in partnering with companies that specialize in reverse logistics operations. In general, the companies that have been most successful with their reverse supply chains are those that closely coordinate them with their forward supply chains, creating what we call a closed-loop system. Asset Recovery Growing According to Dr. Dale Rogers, professor of logistics and supply chain management at Arizona State University, reverse logistics is going to become increasingly popular with logistics managers seeking a process to achieve proper disposal of excess inventory. Reverse supply chains differ from forward supply chains in information flow, physical distribution flow and cash flow. Remanufacturing and refurbishing activities also may be included in the definition of reverse logistics." What is a reverse supply chain? However, on the general basis, there would be 5 distinctive processes in a reverse supply chain system. For instance, Tom Giovingo, executive vice president at Wauconda, Ill.-based Fidelitone, an outsourced logistics and supply chain services provider, suggests that the reverse supply chain is frequently much more labor-intensive than the forward supply chain. endstream endobj This is the reverse of the traditional supply chain movement of goods from vendor to customer. If it’s the latter, the company should expect to make heavy investments in consumer education and other marketing efforts. In other words, reverse logistics involves taking products back from customers and reworking those products (or parts of them) to create a new product that can be sold. This includes business processes that involve transport from distribution endpoints such as retail locations back in the supply chain to locations such as warehouses and factories. If you’re going to setup up, operate, and innovate a top-notch reverse logistics pipeline it takes skill, knowledge, and capital investments. A rather complex process, reverse logistics is the exact opposite of forward logistics. Amazon has multiple solutions in place to handle their customer returns. It builds sensors into the motors of its power tools, which indicate whether the motor is worth reconditioning. Companies are using reverse supply chains as integral parts of new businesses. Reverse Logistics Companies: Using Metrics to Track Performance. The most common scenario in which reverse logistics come into play is when a customer wants to return an item. Better Reverse Supply Chain Process Transparency. The Supply Chain Minded community aims to inform and connect professionals active in Supply Chain, Purchasing, Manufacturing, Warehousing, Transport, Distribution; Reverse Logistics, Service Logistics, Lean & Six Sigma, 3PL. Supply Chain Minded is a very active and fast growing online community in Supply Chain for Planning, Sourcing, Manufacturing, Delivery and Reverse Logistics professionals. Reverse Supply Chain Reverse supply chain refers to the movement of goods from customer to vendor. May 12, 2017. Strategic planning helps to minimize waste and risk, while tactical implementation of technology can enhance existing systems to edge out the competition. Before setting up reverse flows, companies need to evaluate the supply chain within which the business operates. Reverse logistics is for all operations related to the reuse of products and materials. Once collected, products need to be transported to facilities for inspection, sorting, and disposition. Beginning in 2003, for example, European Union legislation will require tire manufacturers operating in Europe to arrange for the recycling of one used tire for every new tire they sell. Companies may face hurdles such as complying with policies regulating the transport of waste as well as the unevenness of quality and quantity in return loads. Again, making smart decisions early in the chain—in particular, when you accept and sort returns—will help to reduce manufacturing variability and, hence, costs. This is essential as even improvements within the reverse logistics supply chain do not always pay off to the tune of their expected savings. If a company plans to sell a recycled product, it first needs to determine whether there is demand for it or whether a new market must be created. By embracing reverse logistics strategies including returns management; product repair and refurbishment; recycling of goods and materials; and proper disposal of materials from unwanted goods, companies can move the sustainability needle while also cutting costs and reaping products … Efficiency is a vital aspect to successful supply chain management in the food and beverage industry, particularly when perishables are involved. Forward Supply Chain . Reverse Logistics has become a critical component of supply chain management due to its impact on cost, sustainability, branding, customer service, and customer loyalty. One of the most complicated and poorly understood terms – reverse logistics (RL), is also one of the toughest nuts to crack. 46(2). Bosch, for instance, has built a successful business selling power hand tools. 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