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Using the Reverse Logistics Chain to Maximize the Value of Your Supply Chain


The reverse logistics chain is the process that consists of implementing, planning and controlling efficient, financially effective flow of materials, inventory in-process, completed goods and related information from the point of consumption to the end point which is used for recapturing the value of the material or the proper disposal of it. These steps may take place due to damaged items, seasonal products, recalls that have occurred or excess amounts of inventory. Recycling programs as well as hazardous material programs fall into the definition of reverse logistics chains too along with obsolete equipment and asset recovery.

One Way that Utilizing a Reverse Logistics Chain Benefits Your Company

The best example of utilizing a reverse logistics chain is in that of a returned product to your company. If one of your customers purchases something from your store and they are unhappy with that product they will probably return it. If they do this then they have already lost some faith in your products. Making the return process easier for them will help regain that trust they have in your company; without a reverse logistics chain process the steps of a return could become a hassle.

Recycling Should be a Part of Your Reverse Logistics Chain

If your company sells appliances or other large ticket items, you should consider adding recycling to your reverse logistics chain. When a customer purchases a large item they often don’t know what to do with it when it has reached the end of its use. By adding recycling to your reverse logistics chain you would not only assist your customers in discarding the used product, but you could also generate additional revenue for your company.

Deciphering the 3 R’s of the Reverse Logistics Chain

Return, Refurbish, Resell; these three small words are a large part of your reverse logistics chain. If an item is returned to your store or warehouse then your quality department must determine whether the item should be refurbished and resold. Tossing an item aside just because it is returned means lost revenue for your company. Many people return items because the packaging is damaged and they don’t want to take the chance that the product is damaged as well. If possible, returns should be refurbished and resold so that you can generate the profit that was originally intended.

The Proper Reverse Logistics Chain Will Help Increase Your Profit

As long as you have the proper reverse logistics chain steps in place you will be able to make a profit on every product that leaves your warehouse/store. Keeping your customers happy with an easy return policy and recycling materials that are of no use are both ways to help your customers so that they will remain satisfied with the service your company provides. Don’t forget the 3 R’s in the reverse logistics chain, these are very important functions that will also help you to maximize your profits. Return, Refurbish, Resell; these three key words could make all the difference in the world when it comes to turning a profit for your company.