Meeting the Reverse Logistics Challenge
Hard data and sophisticated planning are key when goods and materials start flowing upstream through the reverse supply chain
On the retail side, where returns are a perennial issue (and account for 10 to 20 percent of goods sold, on average), Phil Corwin, with UPS Supply Chain Solutions, says that retailers are becoming more sophisticated about incorporating data on returns into their assessments of the value of any give customer. A big-spending customer with a low return rate is obviously more valuable as a client than a low-spender with frequent returns. "They're assessing your profitability as a customer and tailoring their returns policies on the spot," Corwin says.
Other companies are leveraging reverse logistics to better manage their inventories. Fidelitone, for example, will take in usable returns and hold the products or parts for a client for a set number of days — 60, 90, 120, depending on the product's lifecycle — and allow that client to fulfill orders out of Fidelitone's holding warehouse using that inventory rather than producing and shipping a new unit from the factory.
Looking ahead, Click Commerce's Wodarski believes that the future of reverse logistics lies in the convergence of the planning and execution sides of the process. "Because if you make execution decisions in reverse logistics without being mindful of what the goals and planning targets are, you're not going to make the best decisions," he says. "And conversely, if planners don't have visibility to where their assets are in the field and what their status is, they're going to make bad deployment, replenishment and resourcing decisions." What's it going to take to bring those two sides of the business together? High-level executive sponsorship, says Wodarski. "You need a sponsor who can take ownership of the whole process instead of letting the two factions just lob balls across the fence at each other," he says.
Sidebarr
Reverse Logistics Providers
Companies offering specialized solutions and services for reverse logistics include:
Andlor Logistics Systems — www.andlor.com
Choice Logistics — www.choicelogistics.com
ClearOrbit — www.clearorbit.com
Click Commerce — www.clickcommerce.com
ComServe Network — www.comserve-network.com
eBoomerange — www.eboomerang.com
Flextronics — www.flextronics.com
Genco — www.genco.com
Integrated Warehousing Solutions — www.irmswms.com
Intellareturn — www.intellareturn.com
Manhattan Associations — www.manh.com
myRMA — www.myrma.net
Newgistics — www.newgistics.com
Pro Active Solutions — www.pro-activesolutions.net
R-Logic International Pte Ltd — www.rlogic.com.sg
Return Products Management — www.rpmrlm.com
Solectron Global — www.solectron.com
Supply-Chain Services Inc. — www.supply-chainservices.com
System Design Advantage LLC — www.sdalogistics.com
Teleplan International — www.teleplan.nl
UPS Supply Chain Solutions — www.ups-scs.com
USF Logistics — www.usfc.com
USI Inc. — www.usiinc.net
Additional Reverse Logistics Resources
Reverse Logistics Executive Council www.rlec.org
Reverse Logistics Association www.reverselogisticstrends.com
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