Solution provider benefits intel s solution is based on a flexible iot architecture that was. Research executive summaries series tools to manage reverse logistics overview of project reverse logistics has become an area that retailers and manufacturers cannot ignore. Ernst 2000, reverse logistics involves the return flow, considering either defective parts packages or products returned consumed that should go to a recycling. Since reverse logistics involved many more steps and processes as materials move back through the supply chain, its understandable that it takes up a notable amount of all logistics costs in the u. Logistics platform iclp, which is based on microsoft azure and aligned with the.
A facet of the reverse logistics process is that companies should offer end of life recycling for items they sell. It is a process of flow of goods or material which are unwanted or defective through the logistics chains to the manufacturer so that it can be recycled, reused, or disposed of properly the meaning of reverse logistics. Reverse logistics areas of activity and reverse steps. Pdf closedloop supplychain channels are distribution systems that. This thesis is dedicated to the precise analysis and assessment of reverse logistics and finding possible solutions for the optimization of reverse logistics in mining industry namely in. Transform data to action with intel connected logistics.
Pdf reverse logistics has been stretching out worldwide, involving all the layers of supply chains in various industry sectors. Impact of reverse logistics applications on customer. An empirical investigation article pdf available in procedia social and behavioral sciences 58. The study also tries to look at the environmental aspects of reverse logistics. Pdf role of information technology and collaboration in reverse. Jul 10, 2017 reverse logistics is a strategy in supply chain management in which a company collects and reuses some part of their distributed good. The aim of this paper is to develop a framework which will define the metrics that can help to develop successful reverse logistics operations. This is exacerbated by the multiple entities customer, manufacturer, reseller and disposer that need to partner to develop a smooth reverse logistics program. Reverse logistic is a discipline that consists in managing and optimising. Reverse logistics activities it can include a variety of activities depending on whether the goods are returned from a customer end user or a distributor, whether the goods sent back is a packaging material or a product and similar other factors.
The impact of reverse logistics has become a major operational challenge for ecommerce businesses of all sizes. Reverse logistics is one of the least focused areas for many companies. Bricks, clicks, or mix dilemma is an original phrase inspired by former intel. A new core competency companies and their supply chain managers can no longer afford to treat reverse logistics as an afterthought. However, it is rare in academic journals to find studies of the synergy effects of integrating the two flows, even though many logistics companies practice both flows in. A conceptual framework of reverse logistics impact on firm. Therefore, they just focus on trying to reduce the cost of returns processing. Reverse logistics encompasses recapturing the value of products, parts, and materials that have been returned from the end consumer in order to get them back into the marketplace as quickly as possible.
Return management systems, and by the same token, reverse logistics requirements, vary based on product and business model attributes. During the same year, the first commercial study of reverse logistics was made by dr. In an instance, of reverse logistics, products move back from customers to distributors or manufacturers. Reverse logistics includes handling, storage, transportation, inspection, repair. How intel s reverse logistics strategy took customer excellence to the next level stephen noonan intel reverse logistics magazine edition 66. Reverse logistics cost in the future, the use of sensor tags and fixed, permanently installed gateways in warehouses, trucks, planes, ships, and trains will greatly simplify reverse logistics, which is the management of return of the gateways. Managing reverse logistics to improve supply chain. The reverse logistics process is illustrated in figure 1.
In reverse logistics concept there are several activities the companies carry on with returned products or materials and they need to identify the possible destination of returned product i. Typically, a supply chain network creates a path for companies to reach consumers. The rising impact of reverse logistics on ecommerce. The management of supply strategy, global transportation, warehousing, and reverse logistics are evaluated for success through the order fulfillment quality ofq program. Returns shouldnt be seen as a cumbersome, unavoidable cost but as an opportunity to strengthen and grow your business across multiple channels. How intels reverse logistics strategy took customer. Automate reverse logistics with a web interface that demands a return merchandize authorization rma and compliant label for every return. Robust and ready to scale to keep pace with demand, and built to support multiple iot implementations. Aug 24, 2011 reverse logistics is, of necessity, an information technologyintensive business, says steve manning, vice president at milpitas, calif. Collection center location with equity considerations in reverse. In short, reverse logistics needs to become a core competency. It typically involves returning a product to the manufacturer or distributor or forwarding it on for servicing, refurbishment or recycling.
Reverse logistics is a strategy in supply chain management in which a company collects and reuses some part of their distributed good. Retail is currently experiencing a tsunami of returns, according to tony sciarrotta, executive director of the reverse logistics association. How to plan for reverse logistics in your supply chain. Aug 22, 2016 reverse logistics is the set of activities that is conducted after the sale of a product to recapture value and end the products lifecycle. Costeffective solution for endtoend supply chain visibility. In attempting to better manage the constant flow of returned goods, manufacturers have identified target areas key to streamlining the reverse logistics. Logistics in general has been estimated to take up about 10. Definition of reverse logistics reverse logistics is defined as all efficient processes for planning, implementing and controlling the flow of raw materials, manufacturing assets, finished products and information relating to this flow, both upstream and downstream, in order to satisfy the end customer consumer. Intel g lobal reverse logistics intel ireland collinstown ireland. Reverse logistics an overview sciencedirect topics. The six hidden costs of reverse logistics inbound logistics. Reverse logistics is the all encompassing process of reusing products and materials.
Reverse logistics magazine integrating reverse logistics. Solutions developed facilitate the project management of asset recovery or returns, data erasure, forward and reverse logistics, asset tracking in transit, custom reports and much more. The organization tradeport usa has been offering reverse logistics services to retailers, manufacturers and distributors for more than a decade. The provision of reverse logistics services for intel products.
Reverse logistics, green supply chain, end of life, remanufactured product, deposit system. Recovering lost profits by improving reverse logistics 5 impacting the bottom line many executives compare the amount of money spent processing returns to other supply chain activities and conclude that investing resources elsewhere would yield greater results. Parts salvaging if a particular product cannot be repaired and should be discarded, its components can be taken apart and put back into use. The us army first paid its attention to reverse logistics operations in 1998. Reverse logistics practices have been in existence for a long time, especially in the automotive industry, where manufacturers try to recover value from recycling car parts. The strategies followed in reverse logistics are disparate due to the type of skus being handled. Headquartered in the historic small city of somersworth nh, this dynamic, innovative company has established an expertise in recovering and reselling consumer electronics at wholesale prices. Comprehension and implementation of reverse logistics are also connected to the understanding of the life cycle of a product, which is related to the environmental impact assessment referring to a product or service, from the acquisition of raw material to its final.
With the average retailer realizing 30% of annual sales during the holidays, coupled with a 24% return rate, technology now plays an important role in minimizing these reverse supply chain costs, retail info systems news reported last week. Reverse logistics is the set of activities that is conducted after the sale of the product, such as servicing, refurbishment, and recycling for the purpose of recapturing value or recovery or proper disposal. Warehouse management system simplifies reverse logistics. Intel and intel xeon are trademarks or registered trademarks of intel corporation. Schematic representation of the direct and reverse logistics processes. Reverse logistics planning for the retail supply chain. The function has been around since the phoenicians began shipping amphorae of wine to rome in 1,500 bc the movement of product invariably results in the. Using this method instead of a live call center cuts returns costs by 35 percent to 50 percent, according to research firm gartner.
Reverse logistics consists of all activities which are performed after the sale of a product. Contents understanding the true cost to serve 04 reverse logistic approaches 11 criteria to consider when choosing a reverse logistics service provider 12 conclusion 15 1 nternational cooperative nternational a wiss entity emer rms of the networ of independent rms are afliated futureproof your reverse logistics 5 with nternational nternational provides no client services o memer rm has any. In this whitepaper, weve defined the reverse supply chain process, the steps involved and how. Investigation of barriers and factors affecting the reverse logistics. Reverse logistics maturity model rlmm homing in on reverse logistics needs and key success drivers there is no one way when it comes to going and staying circular. An integrated forwardreverse logistics network optimization model for multistage capacitated supply chain. Reverse logistics is based upon heightened environmental consciousness, public policy and the law. The following are common types of reverse logistics. Its a process that many businesses havent mastered yet, because the goal of the retail and retail supply chain. Today, the customers have the benefits of greater product variety. Importance of reverse logistics supply chain minded. Understanding the difference between reverse logistics and. But wait, youre just sending a widget back how is that a challenge for.
Introduction to management of reverse logistics and closed loop. Reverse logistics management usually involves returns, recalls, repairs and refurbishment, repackaging for restock or resale, recycling, and. Reverse logistics stands for all operations related to the reuse of products and materials. Innovative reverse logistics services combined with these metrics, lead to a more responsive organization. Apr 17, 2015 reverse logistics handles the processes that are used to return products, parts and materials from the end user or final consumer. Reverse logistics is a broader concept for overall supply chain optimization, which aims to support closedloop supply chains by the improvement of such activities as product design, supply chain design, and product recovery. Research executive summary 3 research executive summaries series tools to manage reverse logistics figure 2.
Value added services vas configure, create and perform custom vas processes. Reverse logistics supply chain solutions technology industry. New methods, technology turn reverse logistics woes into an. However, the ability to recuperate assets and revenue in the supply chain is causing a refocus in this area. Intel g lobal reverse logistics intel ireland collinstown industrial estate leixlip county kildare ireland has been assessed and deemed to comply with the requirements of the above standard in respect of the scope of operations given below. An inefficient returns process erodes profit margins and undermines customer satisfaction, while an efficient process helps attract new buyers and builds customer loyalty. The first by stock 1992 recognized the field of reverse logistics as being relevant for business and society in general. Dells innovative supply chain dell supply chain free. Drivers and barriers of reverse logistics practices. Paperwork and poor workflow processes tend to plague reverse logistics operations.
Top 3 benefits of a reverse logistics management program. Download pdf certifies that intel corporationpost sales support, complies with the iso 9001. Understand the returns management reverse logistics. The way forward part i of ii although reverse logistics is often overlooked, retailers that master this discipline can gain competitive differentiation and turn the.
In our experience with numerous retailers, reverse logistics remains an overlooked area. Introduction product recovery refers to the set of activities designed to reclaim value from a product at the end of its useful life ferrer and whybark, 2000. Reverse logistics is like cleaning up the morning after a big party a mess that no one really wants to face, resulting from things that are left over or illused from the day before the notion of reverse logistics isnt new, of course. Mutha and pokharel 2009 argued that reverse logistics can be seen as a forward chain redesigned to manage the flow of products backwards from customers to manufacturing for refurbishment and reproduction. There is a lack of understanding of what is being returned and why.
A company has varied disposal options to choose once a product has been returned. The reverse logistics process can be divided into two categories depending on the areas of reverse flow which in turn comprises of primary products, or primary of packaging. Pdf the purpose of this paper is to explore the influence of human resource management on reverse logistics rl in the context of hightech firms find. Intel g lobal reverse logistics intel ireland collinstown. Dells innovative supply chain free download as powerpoint presentation. This is an example of the potential of utilizing reverse logistics to save money and to practice environmental sustainability. Here are four strategies suppliers are adopting to improve their reverse logistics. A best of practice solution is carefully developed and implemented following well established agile and project management processes. An efficient and sustainable reverse supply chain enables companies to. Every step in the reverse logistics process adds value even though it is not always seen in the electronic device itself. Reverse logistics impact the supply chain, says arrow. Currently the literature has abundant reports separately addressing forward and reverse flow logistics systems. Drivers of product returns bernon and cullen, 2007 forecast accuracy and demand variability. Oct 03, 2016 reverse logistics technology technology utilized retail manufacturing automated material handling equipment 31.
The intel connected logistics platform iclp and microsoft azure joint solution architecture serves as an example and. Meeting the reverse logistics challenge supply and demand. Oracle warehouse management cloud enterprise edition data sheet. Companies can see between 4% 30% of their products returned by customers and total uk retail returns have been valued at around. The lack of awareness of benefits of reverse logistics is a major barrier for its implementation.
Reverse logistics is the flow of sold goods back to the company in the opposite direction of movement of the supply chain. Reverse logistics is an integral component of the supply chain and manufacturers have come to realize that an effective reverse logistics program is an important and strategic part of their business profitability and competitive position. The intent is to keep customers so satisfied with their products and services, before, during, and following the original delivery, that they remain loyal to their suppliers. Reverse logistics is the management of all the activities involved in the flow of goods, demand information and money in the opposite direction of the primary logistics flow, including reduction in the generation of waste, and management of the collection, transport, disposal, and recycling of hazardous, as well as nonhazardous waste, in a. Global reverse logistics grl is a department within intel ireland, whose role is to provide warranty services to intel s direct and indirect customers within europe, the middle east and africa emea. Typically this includes repair, warranty recovery, redistribution, value recovery, endoflife recycling or any combination of these activities. However, in reverse logistics, companies create a new supply chain network that works backwards, and allows consumers to reach. It has resulted in an increase in unsold products, rate of returns, packing.
Transform data to action with intel connected logistics platform. Reverse logistics becomes a major issue of concern due to its strategic importance in alleviating environmental problems and generating economic benefits for business organisations. Many shippers, or shippers who have employed a third party logistics provider, use their logistics and reverse logistics management capabilities as market differentiators. Reverse logistics is any process that involves moving things from the customer back to the producer. Using 4 reverse logistics benefits to boost supply chain. 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. Reverse logistics aims to increase the bottom line for businesses with the creation and implementation of improved internal processes. Pdf how do technological skills improve reverse logistics.
There is just too much at stake in terms of brand protection, sustainability requirements, and ultimately profitability. The journal of transport and supply chain management jtscm seeks to disseminate research results and to support high level learning, teaching and research in the areas of traffic and transportation operations, policy, planning, customer service, warehousing, inventory management, procurement, packaging, materials handling, reverse logistics, demand forecasting, distribution communications. The returned products are recovered where possible and failure data provided to intel to support product improvements. Investing in a reverse logistics strategy can come with upfront capital expenses, but it can also yield longterm benefits. Reverse logistics is a new notion in the history of logistics and supply chain management. The main concept is that reusable packaging, as well as outdated, damaged or defective products, can best be recycled or reused by the original manufacturer. Reverse logistics or the reverse supply chain refers to the processes associated with managing products beyond manufacturing and the final sale. When a customer purchases an appliance such as a washing machine and it reaches the end of its service life, the customer will often not know how to deal with that item. Reverse logistics is sometimes called aftermarket supply chain, aftermarket logistics or retrogistics. Reverse logistics programs are typically complicated by a number of factors.
Generally, logistics is known to be the process of transporting products from manufacturers to customers. Reverse logistics is a process you must have in place for the returned and recalled product to follow that is efficient, guarantees the item makes it back to the right inventory if necessary and costs the least amount of money. Oct 04, 2017 reverse logistics is an oldschool, messy, awkward stepchild of an industry, but with skyrocketing return rates and record amounts of overstock, tech adoption is becoming essential. It is the process of planning, implementing, and controlling the efficient, cost effective flow of raw materials, inprocess inventory, finished goods and related information from the point of consumption to the point of origin for the purpose of. Reverse logistics management managementa comprehensive set of capabilities to manage endtoend reverse logistics process for retailers, manufacturers and third party reverse logistics providers.
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