Reverse logistics refers to the supply chain process associated with either capturing value or proper disposal of any product when it’s being returned from their typical final destination, in the case of retail logistics, the consumer.
Many retailers struggle with handling consumer returns due to the lack of clearly defined reverse logistics policies & processes through all the essential logistics stages.
Processing returns from online sales in a brick and mortar location can also cause difficulties in capturing value, as in most cases the returned item can’t be put back in stock at this retail location and needs to be shipped to a return processing facility.
If the store is responsible for returns processing, the returned items usually wind up in the backroom of the stores to be dealt with at a later date. This is especially true during seasonal peak periods and often these items end up forgotten about, lost, or stolen. Some merchandise will never make it back to the retailer, resulting in lost revenue.
One of the aspects of reverse logistics is conducting minor repairs and tests before the product can be re-inventoried. If the product is broken but fails under warranty, the retailer ensures that the product is repaired before being sent back to the consumer. If the item is beyond repair, it is important to be able to dispose of it by either recycling it according to best sustainable practices, after removing the label or donating it to a charity. Often time’s retailers lack the expertise to conduct these tasks and end up spending a lot of money having these services performed by multiple service providers.
The best alternative is to partner with a trusted 3PL that provides not only forward logistics but also reverse logistics, covering all aspects of this complex process.
SCI’s proven knowledge of retail reverse logistics will help you deliver the best service to your valued customers. Contact SCI to learn how we can help with all your retail reverse supply chain logistics requirements, from developing best in class reverse logistics strategies through to day to day reverse logistics supply chain management.