Reverse logistics is the process of moving goods from the point of consumption back to the point of origin for recapturing value or proper disposal. It includes processing returned merchandise for reasons such as damage, product obsolescence, warranty claims, faulty orders, or end of product life cycles. Successful reverse logistics requires collecting return information, segmenting forward and reverse supply chains, implementing information technology, analyzing return reasons to prevent future returns, and potentially outsourcing return processing.

1. REVERSE LOGISTIC
DANIELA MEJIA CONDE
JUANITA SUAREZ CAYPA

2. REVERSE LOGISTIC
Is the process of moving goods from the point of consumption to the point of origin for
the purpose of recapturing value or proper disposal.

3. Take Supply Chain Enterprise Return
Management
https://www.youtube.com/watch?v=MEkXfxleLBk

4. Reverse logistics also includes processing returned
merchandise due to:
Damage
Obsolete
Equipment
Seasonal
Inventory
Recycling
Programs
Excess
Inventory
Restock Recalls Salvage

5. Return Reasons
• when the product is not what is expected
• when the product does not arrive in a defined period
Customer NOT Satisfied
• The consumer assumes that the product is damaged
but really that was installed improperly due to lack of
instructions.
Installation or Usage
Problems
• when the product does not work properly
• when the product has physical damage
• - when the product is repaired by warranty
Warranty Claims

6. Return Reasons
•Incomplete orders
•Misguided amounts
•Premature delivery and duplicate
Faulty Order Processing
•Excessive quantities of products
•New orders at the end of trimester Retail Overstock
•Product life finished
•New product trends
•Old products are eliminated
End of product life cycle
or product replacement
• Installation by the manufacturer
•Standards of product safety
•Corrective measures
Manufacture recall
programs

7. Other Complications
The Green Factor E-Commerce Shorter Product Life Cycles Complex and
Environmental
laws.
50% of the
goods sold
are returned.
Obsolence
high, product
value fall 12%
per month.
underdeveloped area
Reverse logistic
not adds value
to the product
and generates
financial
pressure.

8. REVERSE LOGISTIC AND RECYCLING
https://https://www.youtube.com/watch?v=D4CuaN7
9XZY

9. Attacking the returns challenge
(key steps in the process of return)
Local
Screening
Collection Sorting Disposition
• Is done at the point
of collection of the
returned products.
• To avoid
unnecessary costs of
transport are due to
pick up the products
at the point where
they were delivered.
(scanner)
• Example: Nintendo
• There are many
different ways to
collect the products
that are destined to
enter the reverse
supply chain
• The complexity of the
process and the
multiple parties
involved generates
differents systems to
returns
• Example: Ford
• Some large retailers
have been using
centralized return
centers (CRCs
dedicated to handle
their entire reverse
logistics
operations.When a
company use that
have an optimization
arise from a whole
range of areas
• Example: GM
Sell as-it
Repair or
Reuse
Dispose

10. Create Profit Centers
Some companies
created profit
centers around their
returns process
Focuses the
organization on
maximizing the
prices
They will get for the
goods by exploring
innovative ways
To sell their returned
goods.
A key problem in
selling returned
goods is price setting
Usually experts un
sales and marketing
set prices for new
products
Returned goods
prices are frequently
Determined through
negotiation

11. E-Auction
To obtain the
highest prices for
returned items
Some service
providers have set
up capabilities
To coordinate
returns and help
manufacturers
recoup
Some of their cost
by reselling
returned goods
on internet
auction sites

12. REVERSE LOGISTIC S ECOSYSTEM
https://www.youtube.com/watch?v=9w_OmYDxvAA

13. Change to Leading Practice Organizational Structure
SEGMENTING THE SUPPLY CHAIN
Into separate forward and reverse
organizations can improve efficiency
OUTSOURCING
Is another way of effectively organizing
the returns process
EXAMPLES
Compaq, Thomson, Target and 3M

14. Implement State-of-the-art Information Technology
Collecting the right information to allocate and accurately
calculate debits and credits is crucial for manufacturers and
distributors
While integration with back office functions remains an issue, the
widespread use of internet technology has substantially improved
the way different supply chain partners can communicate with
each other.
New information technologies can be used to analyse return
reasons and provide valuable information to prevent future
returns.

15. Analyse To Prevent Returns
A return goods
management system
provides a window into
manufacturers faults
Companies need to
look beyond the
processing of returns to
reduce their reverse
supply chain cost.
A good reverse logistics
system includes proper
data collection and
effective reporting.
To understand a
consumer,s reason for
returning a good,
companies must collect
structured and
consistent data
concerning the reason
for the return and the
product and its
condition.

16. Outsource The Returns Process
Outsourcing of the returns process is also ocurring on a
more frequent basis and seems to be an alternative to
avoid high investments in reverse logistics e-capabilities.
Example: Manufacturers such as Compaq, Dell, Cisco
and 3M and retaillers such as Sears have outsourced the
handling of the reverse flow of godos.
These outsource suppliers have become specialist in
managing the reverse flow of godos and can achieve
economies of scale.

17. Successful Reverse Logistics Projects
Example of complete reverse
logistic: Estee Lauder
Investment of 1.3 million to build its
propietary reverse logistics system
of scanners, business intelligence
tolos linked to an Oracle database
The company has apparently
recovered its investment in the first
year through reducing labor and
other costs.
When companies decide to
embark on a reverse logistics
Project they can leverage
knowledge, tolos and processes
from other successful projects
Such as Estee Lauder s, to prevent
them form reinventing the Wheel.
Can be made to:
-Reduce Cost
-Improve customer service and
-Increase revenues

18. SOURCES
• Google Images
• YouTube Videos
• Schatteman, O. (n.n) Reverse Logistic lecture.