Reverse logistics or reverse logistics management (RLM) is the management of decreasing product returns, waste disposal, source reduction, materials substitution, reuse of materials, recycling, refurbishing, repair, and remanufacturing.
Reverse logistics is the “reverse” of standard supply chain operations. The supply chain is responsible for moving the items or goods from the raw material to the warehouse, to the client, and then to the customer. However, when talking about reverse logistics, the primary function is taking products from the customer back to the warehouse (closing the supply chain). It is beneficial not only for returns but also to regain value and ensure customer satisfaction.
Although a well-managed reverse logistics program can result in savings in repairing the product(s), recycling the reusable components, or reselling them, the main objective is customer satisfaction. A happy customer will buy again if the return process is smooth and fast.
Companies that deliver goods to a final destination in the supply chain can benefit from reverse logistics. It is understood that 10% of items are returned to the seller. That number will increase to 30% if products are sold online. Having a 3PL company to back you up in this process is essential. An adequately managed 3PL service will save money by increasing your return process efficiency and customer satisfaction.
One of the elements some clients take for granted is the return of the product. Evaluating product eligibility for credit by applying manufacturer returned goods policies and agreements is critical.
The process itself is challenging and costly. On-site Return Preparation, Recall Management, and Administration might take time, which is why it is better to invest in an external transportation company to rely on.