Reverse Logistics refers to all the operations associated with the reuse of product and materials. It is the process related with moving products from their point of consumption to point of origin after the point of sale, and to optimize this activity by recapturing product value or proper disposal, thus saving money and environmental resources. In easy words when a product moves through the Supply Chain Management to the consumer and any process or management after the delivery of the product involves Reverse Logistics. If the product is defective, the consumer would return the product, then the manufacturer would take care of the shipping of the defective product, testing the product, repairing, recycling or disposing the product and the product would travel in reverse through supply chain system in order to retain any use from that product, whole management for this process is Reverse Logistics.
Benefits of Reverse Logistics
- With Reverse Logistics System more value can be extracted from returned goods rather than of wasting time, manpower, cost of raw materials used in Supply Chain System.
- Happier customer’s loyalty and trust can be improved by paying more attention to the repair of faulty goods or refunding them. Which leads to gain feedbacks to make improvements and to improve the understanding or feel reasons for product returns.
- Reverse Logistics allows a manufacturer to receive products back from the consumer to be taken apart, sorted, repair, reassembled or recycled, reducing the overall cost for a company.
- From a view of environmental responsibility, it is important to implement supply chain system which is environmentally sustainable. And by making Reverse Logistics system more efficient it can reduce the burden on the logistics assets and the environmental resources to keep them running.