Whether or not you currently use them, or you’re unsure of their meaning, your manufacturing or distribution company will likely need reverse logistics in Toronto in the short-term.
There are two main reasons for this. First, the emergence of e-commerce as the selling method of choice for B2C (and increasingly in B2B) businesses means reverse logistics can help them streamline product returns. Second is the realization by many businesses that managing returns isn’t a cost item, but a business opportunity.
What Are Reverse Logistics?
Reverse logistics are the processes used to manage returned products. Also known as aftermarket supply chain, aftermarket logistics or retrologistics, they include the management of each step a product takes from the moment it is determined that a product must be returned.
The process can include elements of customer service, return inventory route planning, which starts with “first-mile” transportation, and in-house distribution centre capabilities to manage returns and the complete aftermarket logistics supply chain management system.
How Reverse Logistics Can Create Business Opportunities
For many manufacturers and distributors, the only path to creating inventory is, respectively, through the manufacturing process or by acquisition from suppliers. In those scenarios, returns are often considered an added cost of doing business. But by optimizing returns management with a reverse logistics system (RLS), companies can develop a number of business opportunities.
- Reduce Costs – A RLS that includes product servicing and refurbishment can put finished inventory, parts or raw materials back into play.
- More Efficient Handling – With a well planned RLS, cost reducing efficiencies in administration, transportation and handling can be found.
- Increased Customer Retention – Increasingly, B2C and B2B customers choose to buy from companies who demonstrate the ability to deal with a bad experience to their satisfaction. Another way to look at it is, without a focus on reverse logistics, your company might be at a competitive disadvantage.
PiVal offers supply chain services that reduce costs and give you peace of mind. Check out our supply chain services page for more information on reverse logistics as well as several other services that we can help you with.
Looking for more info on how to improve your inventory? Check out our recent article on how to improve inventory management.