Ch 6 Reverse Logistics Presentation

8/12/2019 Ch 6 Reverse Logistics Presentation

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REVERSE LOGISTICS


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Definitions

Logistics (Forward)

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 origin to the point of consumption for the purpose

of conforming to customer requirements

- Council of Logistics, 1988 -

Reverse Logistics

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

- Rogers and Tibben-Lembke -


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Reverse Logistics Activities

Handing of ret!rned"erc#andise Da"age Seasona inventor$ Rese via o!tet Savage of o!tdated %rod!cts Stoc&'aancing ret!rns

Rec$cing and re!se ateria re!se Re"an!fact!ring * ref!ris#ing

Ha+ardo!s "aterias dis%osition


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So!rce, #tt%,**www-r"aga+ine-co"*i"g*edition./0!%s-1%g

T#e Reverse Logistics 2rocess


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Ret!rn 2ercentages

So!rce, Rogers and Tien3Le"&e4 Going 5ac&wards, Reverse Logistics Trends and 2ractices4 6778


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Co"%!ter * Eectronic Ind!str$

S#orter ife c$ces

How to recover and re!se "aterias contained wit#in

E3waste=

Lead4 co%%er4 a!"in!" god4 %astics and gass

E3waste inc!des co"%!ters4 teevisions4 ce %#ones4

a!dio e;!i%"ent and atteries

Re"an!fact!ring of toner cartridges, 694...

re"an!fact!rers4 e"%o$ing /94... wor&ers4 se

near$ >6 iion ann!a$


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A!to"otive Ind!str$

T#ree %ri"ar$ areas, Co"%onents in wor&ing order sod as is

Ot#er co"%onents4 s!c# as engines4

aternators4 starters4 and trans"issionsare ref!ris#ed efore t#e$ can e sod

aterias are recai"ed t#ro!g#

cr!s#ing or s#redding

A!to"otive rec$cers #ande "oret#an ?


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Retai Ind!str$

2rofit "argins are so si" t#atgood ret!rn "anage"ent iscritica

Ret!rns red!ce t#e%rofitaiit$ of retaiers"argina$ "ore t#an"an!fact!rers


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Forward vs- Reverse Logistics


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STRATEGIC SE OF REVERSE LOGISTICS

Reverse Logistics as a Strategic Bea%on

an$ fir"s #ave not $et decided to e"%#asi+e reverse ogisticsas a strategic variae-

T#e #anding of reverse ogistics c#aenges is a strategicca%aiit$-

Reverse ogistics is strategica$ !sed to,

Red!ce t#e ris& of !$ing %rod!cts t#at"a$ not e #ot seing ite"s-

Increase t#e switc#ing costs ofc#anging s!%%iers-

Source: Rogers and Tien-!em"e, #oing $ac"wards: Reverse !ogistics Trends and Practices, %&&'


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STRATEGIC SE OF REVERSE LOGISTICS

Competitive Reasons

Liera ret!rn %oicies over t#e ast few$ears d!e of co"%etitive %ress!res-

Ta&ing ac& !nwanted %rod!cts or %rod!ctsc!sto"ers eieve do not "eet needs-

Good Corporate Citizensip

o se reverse ogistics ca%aiities for atr!istic reasons4s!c# as %#iant#ro%$-

o T#ese activities en#ance t#e va!e of t#e rand and are

a "ar&eting incentive to %!rc#ase t#eir %rod!cts-

Source: Rogers and Tien-!em"e, #oing $ac"wards: Reverse !ogistics Trends and Practices, %&&'


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REVERSE LOGISTICS CHALLEGES

Retailer ! "anufacturer Conflict

Inefficiencies t#at engt#en t#e ti"e for %rocessing ret!rns, Condition of t#e ite" Va!e of t#e ite" Ti"einess of res%onse

T#e$ #ave to deveo% a wor&ing %artners#i% to derive "!t!a enefit-

#roblem Return $%mptoms

o Lac& of infor"ation ao!t

t#e %rocess-o If $o! aren@t "eas!ring it4

$o! aren@t "anaging it-

Source: Rogers and Tien-!em"e, #oing $ac"wards: Reverse !ogistics Trends and Practices,%&&'


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REVERSE LOGISTICS CHALLEGES

Cause and &ffect

2oor data coection eads to !ncertaint$

ao!t ret!rn ca!ses-

I"%roving t#e ret!rn %rocess decreases

costs-

5eing ae to see defective %rod!cts and

to trac& ret!rn iss!es-


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5ARRIERS TO GOOD REVERSE LOGISTICS

'umerous barriers to good reverse logistics e(ist

anage"ent inattention and t#e ac& of i"%ortance of reverse ogistics-

Cor%orate strateg$ for #anding ret!rns and non3saae ite"s-

Lega iss!es do not a%%ear to e a "a1or %roe"-

Co"%anies can not

contin!e to overoo& t#enecessit$ of good reverseogistics "anage"ent-

Source: Rogers and Tien-!em"e, #oing $ac"wards: Reverse !ogistics Trends and Practices,%&&'


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e$ Reverse Logistics anage"ent Ee"ent

G)T&*&+'G

T#e screening of defective and !nwarranted ret!rned "erc#andiseat t#e entr$ %oint into t#e reverse ogistics %rocess

Rogers, (ale, and (on Tien-!em"e


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Reverse Logistics Infor"ation S$ste"s

One of t#e "ost serio!s %roe"s t#at t#e co"%anies face in t#eeec!tion of a reverse ogistics is t#e deart# of a good infor"ations$ste"s- To wor& we4 a feie reverse ogistics infor"ation

s$ste" is re;!ired-

T#e s$ste" s#o!d create a dataase at store eve so t#at t#e retaier can egintrac&ing ret!rned %rod!ct and foow it a t#e wa$ ac& t#ro!g# t#e s!%%$ c#ain

Infor"ation s$ste" s#o!d aso inc!de detaied infor"ation %rogra"s ao!t

i"%ortant reverse ogistics "eas!re"ents4 s!c# as ret!rns rates4 recover$ rates4 andret!rns inventor$ t!rnover

sef! toos s!c# as radio fre;!enc$ (RF) are #e%f!- ew innovations s!c# as two3di"ensiona ar code and radio fre;!enc$ identification icense %ates (RFID) "a$soon e in !se etensive$


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Centralized Return Centers CRC

Consistenc$ in dis%osition decisions and"ini"i+ations of errors

S%ace saving advantage for retaiers w#owant to dedicate as "!c# of t#e s#o% foor tosaae "erc#andise as %ossie

Laor cost red!ction ' d!e to s%eciai+ation4CRC e"%o$ees can t$%ica$ #ande ret!rns"ore efficient$ t#an retai cer&s can

Trans%ortation cost red!ction ' e"%t$

tr!c&oads !sed to %ic& !% ret!rn "erc#andise

A seing too ' t#e eas$ dis%osition ofret!rned ite"s re%resent can e an a%%eaingservice to retaiers4 and "a$ e a dea3"a&erfor otaining or retaining c!sto"ers

Faster dis%osition ti"es ' it aows t#eco"%an$ to otain #ig#er credits and ref!ndssta$ ide for s"aer %eriods of ti"e4 t#!s

osing ess va!e Easier to identif$ trends in ret!rns ' an

advantage to "an!fact!rer w#o can detectand fi ;!ait$ %roe"s sooner t#an if t#eseret!rns were #anded entire$ $ c!sto"erservice %ersonne


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ero Ret!rns

A %rogra" w#ere t#e co"%an$ in ;!estion does not acce%t ret!rns fro" itsc!sto"ers- Rat#er4 it gives t#e retaier an aowae ret!rn rate4 and %ro%osesg!ideines as to t#e %ro%er dis%osition of t#e ite"s- S!c# %oicies are !s!a$

acco"%anied $ disco!nts for t#e retaier

It %asses t#e ret!rns res%onsiiit$ onto t#e retaier4 w#ie red!cing costs for t#e"an!fact!rer or distri!tor

T#e drawac&, t#e "an!fact!rer osses contro over its "erc#andise


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Re"an!fact!re and Ref!ris#"ent

Five categories of re"an!fact!re and ref!ris#"ent,

T#e advantage to !sing rewor&ed %arts is fet t#ro!g# cost saving

6) Re%air9) Ref!ris#ing?) Re"an!fact!ring

"ake te product reusable for

its intended purpose

Retrieving reusable parts from

old or broken products

/) Canniai+ation

Reusing parts of products for

different purpose

J) Rec$cing


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Reverse Logistics and te

&nvironment

Environ"enta considerations #ave agreater i"%act on "an$ ogistics decisions-

For ea"%e, an$ %rod!cts can no onger e %aced

in andfis

Fir"s forced to ta&e ac& t#eir %rod!ctsat t#e end of t#eir !sef! ifeti"e- Decrease of andfi avaiaiit$ and

increase in Landfi costs-


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A n!"er of societa c#anges regarding t#eenviron"ent are #aving a %rofo!nd i"%act

on reverse ogistics- Fir"s are forced to ta&e t#eir %rod!cts ac&

w#en t#e$ are annedK t#is enefits t#e fir"sin two wa$s- T#e$ re!se t#e %rod!cts and

reca%t!re t#eir va!e- T#e fir" is e%osed asan environ"enta$ friend$ co"%an$-

#roduct Take-.ack


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#roduct Take-.ack

an$ co"%anies s!c# as Co"%a;4 Hewett3

2ac&ard4 and ero #ave ado%ted t#eEtended 2rod!ct Res%onsiiit$ (E2R)%rogra"- E2R foc!ses on t#e tota ife of t#e%rod!ct4 oo&ing for wa$s to %revent %o!tion

and red!ce reso!rce and energ$ !saget#ro!g# t#e %rod!ct@s ife c$ce-


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COCLSIOS

Bit#in reverse ogistics4 "aintaining t#e environ"ent and "a&ing

%rofits are co"%e"entar$-

Fewer dis%osed %rod!cts can enefit co"%anies and t#e environ"ent-

Aternate !ses of reso!rces $ etending %rod!cts@ nor"a ife c$ces-

Cost effective and ecoogica$ friend$ so!tions-

Reverse ogistics is not si"%$ a "atter ofdriving t#e tr!c& t#e o%%osite wa$-

Ch 6 Reverse Logistics Presentation

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