Read PDF An Executives Guide to Reverse Logistics: How to Find Hidden Profits by Managing Returns

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Good processes lead to fast turnaround times, fast credits and happy customers. Once the freight has been received and validated by the receiving team, a credit can be issued or an exchange can be shipped.

An executive's guide to reverse logistics : how to find hidden profits by managing returns

Issuing credits can be very costly to your company if not performed well. Care must be taken to ensure your receiving team is properly matching the original items purchased, with the actual items returned. Since many shippers who have employed e-Commerce strategies have big gaps in their receiving processes, items often go missing. As a result, the customer service people at are often instructed to issue un-validated credits upon customer request because they have no way of verifying if the customer really did return their freight.

Good receiving and credit processes can significantly reduce the workload for your customer service personnel who handle the status update calls and emails from customers looking for their credits. The main purpose of inspection and sorting is to stream the returned items to the path of highest selling price or recovery value. This process is often combined or is attached to the receiving process since it is a logical next step while the inbound goods are being handled. At this stage, the customer goods have been received and their credits have been processed and satisfied.


Now it is time to satisfy your corporate needs. This is best done by recovering the highest value possible from the returned goods. Training and product knowledge are often important for the inspection and sorting process. It is a labor intensive process. The better your team understands the products, the faster they can make decisions on how to process the products and the greater the likelihood of them capturing a higher recovery for that item. Processing the returned items is often set up in an assembly line format to enable easy separation of the product as it flows to the next stage.

Processing is very dependent on the type of products being handled.

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Depending on the volumes you need to handle, several stages may be required to streamline the processing. Often similar products or items requiring similar processing are physically streamed and consolidated until there is enough volume to move it to the next stage i. Sometimes tests or test equipment is used to determine how to stream an item.

Each returned item if often given a unique identification tag for tracing and gather statistics on processing and disposition. An asset has value and can be sold. The challenge is to find or recover the highest value for each item. Many shippers do not view the handling and processing of reverse logistics in e-commerce or reverse logistics in general, as a core competency. A number of companies have outsourced partners in one or more of the key Reverse Logistics areas such as transportation management, returned goods processing, e-commerce logistics technology , and services such as freight claims, accounting, and carrier relations.

It is important to understand the processes you need before you outsource, so you can define what needs to be done, how it needs to be done and how to measure success so you are able to effectively choose which partner can best fit your needs. Use our handy 3PL checklist to understand your needs as a shipper. Reverse Logistics in e-commerce is a newly emerging area that is just starting to get the attention of senior management and shipper executives who are looking at or have already implemented an e-commerce channel.

It is highly likely that your company has significant challenges in this area.

(PDF) Modeling and Analysis of Reverse Logistics | Dale Rogers -

Do not be afraid, you are not alone. They do not even teach courses on Reverse Logistics in school yet. Get the latest industry advice on logistics, transportation management, best practices, trends, tips and more! All rights reserved. To subscribe to our blog, enter your email address below and stay on top of things.

We'll email you with a confirmation of your subscription. Tell us a bit about who you are and the people you reach We are targeting senior executives who are new to the field of reverse logistics.

Green Reverse Logistics Brings Many Happy Returns

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