The Importance of Processes in Reverse Logistics - Essay Example

least cost and highest efficiency). A reverse logistics operation is considerably different from forward logistics. It must establish convenient collection points to receive the used goods from the final customer or remove assets from the supply chain so that more efficient use of inventory / material overall can be achieved. It requires packaging and storage systems that will ensure that most of the value still remaining in the used good is not lost due to careless handling. It often requires the development of a transportation mode that is compatible with existing forward logistic system.

Disposition can include returning assets into inventory pools or warehouses for storage, returning goods to the original manufacturer for reimbursement, selling goods on a secondary market, recycling assets, or a combination that will yield maximum value for the assets in question. Reverse logistics, simply put, comprise all activities associated with a product/service after the point of sale, the ultimate goal to optimize or make more efficient aftermarket activity thus saving money. However, easy as it may looks , the processes involved requires a large degree of considerations coupled with careful planning.

Speed of retrieval is the primary measure of efficiency and . Speed of retrieval is the primary measure of efficiency and the choice of the method of transportation is the primary determinant of speed. Unlike in the distribution system where deliveries are made to stationary locations, retrieval would often require door-to-door visits. This is especially a problem in hard to access areas where travel would be tedious and costly. A decision has to be made on what method would be efficient. It may require a combination of measures such as carriers (trucks) for aggregate acquisition and vans/ordinary passenger vehicle for unit acquisition.

Now what was stated above is only the acquisition part. There is also the delivery of the warehoused materials to the processing site. Since transportation will now be in terms of aggregate terms, a carrier must be assigned. In all these process, there is the possibility of problems suddenly appearing. In some case, carriers may always experience breakdowns or may get lost from trying to find the retrieval point. This would generally lead to higher costs as maintenance and fuel expenditures become large.

Transportation may be outsourced and these would generally necessitate an analysis of current market rates. Again, the efficiency of the carrier should be evaluated as they may prove to be too costly for hiring and ineffective for the planned process.Warehousing A logistician's main problem in warehousing Returned products is how to store them until a decision is made on what to do with them. The returned products will require space - that is a fact that every logistician should realize and the firm can not relegate the storage of returning products to others in a way they can when they are distributing new products.

Additional space would mean additional cost of handling to the