Reverse Logistics in 2020
Reverse Logistics: a fundamental technique for companies.
The momentum of the logistics action in the company during the last years has been remarkable, since based on it, competitive advantage can be achieved, in order to recover and economically take advantage of those products that no longer satisfy the needs of the consumer. The concept that refers to the need to reduce waste through new channels is the so-called "Reverse Logistics", in this article the theoretical meaning, the characteristics that compose it and its applications towards social approaches, of production and ecological within the company, from the investigations carried out by the different bibliographies.
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The principles of Reverse Logistics
First, Understand ‘What’ and ‘Why’
Let’s take a step back. Reverse logistics, while not being the opposite of forward logistics, is still about products moving backwards in the supply chain. Often, the term reverse logistics is used for products that have already reached the final point of sale or been bought by a customer. However, remember that products or subassemblies that never made it out of the factory may need to travel backwards one or more stages along the supply chain. This also qualifies as reverse logistics.
Starting to be able to understand Reverse Logistics, it is understood that it is taken into account within the primary activities that make up the value chain of a company (Porter, 1987); then considering this term in reverse would extend the advantage of the organization because the resources available to the company are increased.
Clarifying the meaning of competitive advantage, it is said that it has to do with the theory of resources and capabilities that controls a company and that are valuable, unique, difficult to imitate and replace (Barney, Wright, & Ketchen, 2001) .
The Council of Logistics Management defines logistics as that part of the supply chain process that plans, implements and controls the flow and storage of products and services and their related transformation, from the point where they originate to the point where they are consumed. , efficiently and at least possible cost, to meet customer requirements.
Through the competitive advantage there is the probability of standing out among the competition and in the importance of assets that cannot be compared against others.
Another element that has to do with Reverse Logistics is the supply chain, which is defined by authors as:
Terrado defines the supply chain as, the supply chain is an integrated approach to the logistics processes of supply or internal logistics, and outbound distribution or logistics, allowing the development of relationships with suppliers, the company and customers.
Mentzer, characterizes it as a set of three or more companies connected or related to flows of products, services, finances and / or information from the provisioning to the final customer.
Defining Reverse Logistics
Based on what Riveros says, the birth of Reverse Logistics dates back when there was a concern in the life of the company, specifically in the return or return of merchandise, the recycling of containers, remains, waste, treatment of products with antiquity and that already represented a danger for the organization, inventories without flow, in any link of the supply chain in order that the economic return exists in the logistic processes.
Actors in reverse logistics
In order for reverse Logistics to be used, it is necessary to involve three elements that are fundamental, in order to find the objectives and find those benefits that make a company more efficient with the minimum cost of expenses. It is worth mentioning that the supply chain is essential for the recovery of the products and that, from them, reverse logistics is developed.
From the comments of Dekker, the actors of the reverse logistics are mentioned:
- Main actors, suppliers, distributors, retailers, customers and the companies responsible for the recovery of the product or producer.
- Specialized actors, transport, storage, recyclers, reprocessing or waste disposal operators.
- Related actors, government organizations, NGOs, environmentalists, etc.
Who will do Reverse Logistics well in the future?
The immediate future of logistics and distribution is omnichannel – order anywhere, buy anywhere, including web, post, and physical point of sale. Recent survey information from magazine DC VELOCITY suggests that supply chains are moving towards omnichannel mostly to increase sales, market share, and customer loyalty. Improving margins comes in as a distant fourth reason. Yet margins are likely to be under even more pressure because of the added complexity of omnichannel reverse logistics.
Good solutions are therefore likely to be specific to the supply chains thy serve and leverage the specific configurations of those supply chains. For example, online retailer Amazon recently moved to buy physical retailer Whole Goods. For reverse logistics for this part of its business, Amazon could allow or even encourage any returns from online sales to be made in-store. This would increase the number of visitors to the physical store and decrease reverse logistics costs by batching together returns instead of transporting them one by one as small parcels.
Whatever the reverse logistics solution, it will need to be planned. Also, it might not look anything like your forward logistics. But for all the reasons above, including financial, reputational, ecological, and regulatory, now is the time to stand up and be counted among those who their reverse logistics well.
Companies must be at the forefront and define strategies that improve the stability of their business, with this it is necessary to seek to make their industrial processes efficient and effective, that is where Reverse Logistics is born in order to get to involve the client in the satisfaction of the delivery of the final product or of being an intermediary in the supply chain.
It can be considered to generate competitive advantage because now the company is no longer focused on reducing production costs but now of everything that could have been considered as an abnormal producer, today it can generate new aspects that define it in the market as a company highly competitive when using recycling and remanufacturing return strategies that generate customer value; even today these elements are taken to make processes of a favorable nature to the environment and a socially responsible company.