Now halfway through the first quarter of 2021, business all around the globe is picking up pace, riding the wave of this bouncing back from the pandemic and capitalizing on every opportunity that comes their way to make up for such a terrible previous year. From the emergence of new trends across industries to the sudden rise of new financial instruments into the mainstream, this year is gearing up to be a masterful combination of economic and political events to set in motion the outlook for what’s to come.
Likewise, with all of these gears in place and forecasts pointing to the positive, we think it’s time we touch base on our logistics, an integral aspect of a business that maximizes value captured and reduces material wasted. However, unlike your typical start to end-consumer perspective, with the trend of ensuring the maximum return and better control over the flow of materials, we’ll be exploring reverse logistics.
What Is Reverse Logistics?
As the name suggests, the concept of reverse logistics closely resembles your typical logistics, just backward. Instead of the organization and management of the supply chain, manufacturing, and until the point of consumption, we’ll be tracing our steps back to the point of origin to recapture as much value as possible. In layman’s terms, reverse logistics is the process of moving returned goods for recapturing value, and how companies go about it varies from industry to industry.
- From A Retail Standpoint: The retail industry is booming, and with the massive shift toward online stores, business logistics are more burdened than ever before due to the increased traffic of handling shipping, organizing orders, and ensuring nothing gets lost during the entire process. Likewise, the online platform also exposed the weakness in product returns due to quality complications and defects. Unlike before, where customers could easily walk into a physical retail store to request a replacement, companies and customers alike have to bear with the grueling process of shipping it back, having it checked, and waiting for the request to be fulfilled.
- From The Food Industry: For most people, they just freely select from the variety of food available in the supermarket, have them checked out, and they’ll be on their merry way. However, the food industry has some of the most detailed-oriented business logistics to handle and is the most prone to waste. If the regular and direct supply chain process of transporting and packaging from farm to factory to end-consumer wasn’t hard enough, handling unsold products is worse. If these products aren’t properly disposed of through an effective reverse supply chain, all that food will turn to waste.
How Can It Help Your Business Grow?
Now that we’ve clarified what reverse logistics is and how it works, where does it come into the equation for sustainable business growth and performance? To answer that, we’ll be taking a look at some critical areas where reverse logistics creates opportunities for an enterprise:
#1 A Point Of Evaluation
We live in an age of information. With the data available at our fingertips, the companies that utilize these analytics and references to their utmost potential certainly have an edge in their respective industry. Reverse logistics provides a business with so many key pieces of information to evaluate and gauge customer satisfaction that it would be a complete waste not to include it in your decision-making process.
- Logistics And Marketing: Any seasoned marketing mentor will tell you that, at its foundation, marketing is all about understanding what the customer base needs and understanding how the company can communicate those needs in the best way possible. Therefore, knowing which products experience the most returns and which ones the company struggles with recapturing value is critical to maximizing profit margins.
#2 Reduce Waste, Capture More Value
Sustainability is imperative to an enterprise’s success, and any business that disregards this fact either loses face among their loyal customers, succumbs to inefficiency, or suffers from both. Reverse logistics highlights weak points in the reverse supply chain and is an effective method of optimizing the entire process, reducing the waste generated, and increasing the total value captured.
- Environmental Efficiency: The world suffers enough from climate change, and businesses should stand firm with their corporate social responsibility to address these problems the best way they can. Reverse logistics provides an avenue to improve business operations by increasing overall environmental efficiency, by reducing the amount of waste that the supply chain creates both forward and backward.
Start Strong, Stay Consistent.
There’s no telling where the global economy is headed right now, and as talks of stimulus checks continue and contemporary events present much uncertainty, it’s much better to be safe and vigilant. Therefore, if you’ve been on the search for things to implement and improve in your business, we think it’s the perfect opportunity to look into your business’s reverse logistics.