ebc6230 reverse logistics

8/13/2019 EBC6230 Reverse Logistics

1/23

E-Supply Chain Technologies & Applications

EBC 6230Winter Session 2014

Reverse Logistics

Title : --------------------------------------------------

Submitted toDr. Mohamed Baymout

Prepared byHassan Kiyani 7537640Mohsin Pyar Ali 7512480Naveed Maknojia 7563834Priyanka Jain 7150110Raheel Rehmatullah 7506987


2/23

Agenda

Introduction History

Definition

Forward vs. Backward Logistics

Reason for Returns

Reverse Logistics Process E-Reverse Logistics

Effective Return Management

Challenges

Case Studies

Conclusion


3/23

Introduction [1]

According to research

Gain recognition in both

Research Field

Practical Field

But still since from the last decade.

40% viewed as Headache

34.3% have no right system

33% companies policy inhibited to do


4/23

Introduction: (Cont..)

According to other researches

Reverse Logistics has a great potential

Improve Customer Relation

Improve Company Performance


5/23

History of Reverse Logistics: [1]

Few important events

1872 Montgomery Wards (American

Furniture Shop)

Federal Republic of Germany in 1991 passed

recycling ordinances

In 2001, the European Union


6/23

Reverse Logistics?

The process of planning, implementing, and

controlling the efficient, cost effective flow of

raw materials, in-process inventory, finished

goods and related information from the point

of consumption to the point of origin for the

purpose of recapturing value or proper

disposal. [2]


7/23

Forward vs. Backward

Logistics [3]

Factors Forward Logistics Backward Logistics

Forecasting Straightforward Difficult

Distribution One to many Many to One

Product Packaging Uniform Damage

Product quality Uniform Inconsistent

Visibility of Cost High Low

Destination/routing Clear Unclear

Pricing Uniform Many factors

Market Straightforward Complex


8/23

Reasons of Return

Customer not satisfied:When customer are not satisfied with the product or its notmeet their requirements.

Installation and usage problems:Common in the computer industry where in some categoriessuch as CD-ROM drives get return.

Warranty claims:

Customers return the product because they find any defectiveparts in it and they can return that within a predefined period.


9/23

Reasons of Return (Cont)

Faulty order processing:

The customers or retailer experience incomplete

shipment, incorrect quantities, products and late

delivery.

Commercial return:

products may be sent back due to mismatches in

demand and supply in terms of timing or product

quality


10/23

Return Analysis And Reason

Return % In Various IndustriesVarious Reason Of return

http://www.mbaskool.com/business-articles/operations/108-reverse-logistics.html


11/23

Reverse Logistics Process

Direct

Recovery

Repair

Refurbishing

Remanufacturing

Retrieval

Recycling

Collection

Inspection

Selecting

Sorting

(Re-)

processing


12/23

Reverse flows in the supply chain

Raw MaterialPart

FabricationModule

Subassembly

Remanufacture

Part Assembly Distribution

Reuse

User

Repair


13/23

http://www.supplychain247.com/article/why_reverse_logistics_needs_to_become_a_core_competency


14/23

E-Reverse Logistics


15/23

Effective returns management [4][1]

Improve Return Gatekeeping:Control the return by improve screening & scanning of productsat door level

Outsourcing:

Company can consider help from a third party to handle andmanage the reverse flows, for example DHL FedEx and UPS etc.

Return centres:

The strategic choice of location and facility layout of return

centres to maximize value and cut costs.

Eff i


16/23

Effective returns management(Contd.)

Asset recovery:To maximize returns and minimizes costs by proper disposal ofreturned items

Reducing reverse cycle times:

The company is to improve value recapture by reducingthe time for returns.

Reverse logistic information system:

Information systems to improve visibility of productsreduce uncertainty and maximize economics of scale bydeveloping/adopting an efficient information system.


17/23

Effective returns management(Contd.)

Return products for secondary markets:Negotiate the best price for products being returnedand resold.

Financial Management:To developing guidelines to properly account forcharges against sales and related financial issueswhen products are returned by customers.

Effective return policies and procedures:

Returns approval policies help to ensure effectivegate keeping


18/23

Challenges in Reverse

Logistics

3 perspectives of reverse logistics: Disassembling of returned product

Storage

Transportation

Main challenges in Reverse Logistics Processes Quantity

Time

Quality

This lack of control regarding above mentioned issues are: Reflection of the uncertain life of a product

Product life cycle stage and the rate of technological change


19/23

Case Study # 1: WEEE

CHALLENGES OF WEEE ON REVERSE LOGISTICS:

A CASE STUDY ON A COLLECTION NETWORK IN FINLAND

Source: Published in Proceedings of Logistics Research Network Annual Conference 2006, 6th-8th September 2006, Newcastle upon

Tyne, UK. Eds. Bourlakis, M .et. al. The Chartered Institute of Logistics and Transport (UK)


20/23

Challenge: No proper system for reverse logistics

Solution:

Introduction of laser technology (Printer)

Result:

Expected savings of about $ 900,000 in the first

year by eliminating parts testing.

Case Study # 2: Lexmark

Source:Lexmark and Lexmark with diamond design are trademarks of Lexmark International, Inc. registered in the United States and/or other

countries. All other trademarks are the property of their respective owners. 2007 Lexmark International, Inc. 740 W. New Circle Rd., Lexington, KY40550


21/23

Conclusion

While majority of companies does not consider reverse logistics as much important as

compared to other elements for the success of company, but few firms have begun to realize

that reverse logistics should be considered as strategic part of organization due to its

importance and value driven impacts on long term goals.

To be competitive in market, companies must have to focus on their reverse logistic methods

and consider it as a part of strategic issues.

Nowadays reverse logistic is not only for competitive advantage by reselling products to

secondary market or by improving reverse logistic processes for companies to reuse

products. But also for competitive advantage in market, by providing customers maximum

satisfaction with the help of your great return policy.


22/23

Reference:

1. Reverse logistics Matters: Impact of resource commitment on reverse logistics andcustomer loyalty (Master Thesis). University of Maastricht Faculty of Business

Administration Master Science of International Business Concentration Logistics

Supervisor: Dr. Lieven Quintens

2. Going Backwards: Reverse Logistics Trends and Practices University of Nevada, Reno

Center for Logistics Management. Dr. Dale S. Rogers, Dr. Ronald S. Tibben-Lembke,

1998, Reverse Logistics Executive Council

3. http://www.slideshare.net/anandsubramaniam/reverse-logistics-15793414. Reverse Logistics Case study comparison between an electronic and a fashion

organization by Martin Creutz & Fredrik Larsson in 2012-05-14


23/23

Thanks

ebc6230 reverse logistics

Documents