Reverse Logistics For Retailers And Wholesalers


What is reverse logistics? Reverse logistics, sometimes referred to as logistics management, is an art of planning, designing, implementing, controlling and monitoring the movement of wholesale products throughout the retail and wholesale cycle. It's basically "the process of taking wholesale products from their original final destination to their ultimate destination for the purpose of either capturing added value, or proper disposal." If you're wondering how something so simple can be a business strategy, consider that most of us do not use all of the resources of our supply chain immediately. Our needs come later. For example, Genco, which was acquired by FedEx, is essentially a reverse logistics firm which receives returns on behalf of manufacturers, brands, and retailers, and liquidates these products in an attempt to salvage as much of the products' costs on behalf of the original owners.

This is why companies in the supply chain sector are starting to look at the ways in which they can automate their processes. A good example of this is with fraudulent returns. Many companies have been hit hard by fraudulent returns because they didn't put in the time to streamline their operations. With automation, though, they were able to reduce the amount of time spent on manual data entry, and more time was used to actually collect the goods and close the deal with the customer. These are just two examples of how automation can help businesses.

Another aspect of potential loss in the supply chain is when customer dissatisfaction occurs and a product is returned to a retailer, such as a department store, or an ecommerce marketplace seller, such as Amazon. Logisticians are looking into ways in which to improve their processes, in order to get better customer satisfaction. By automating certain parts of the return process, like clearing customs duties and tracking shipments, companies are able to reduce the amount of fraudulent returns that occur. What is reverse logistics?

In order to understand how automation can benefit your business, you first have to understand what happens in reverse logistics processes. The raw materials are taken to distribution centers, from where they are loaded onto trucks for transportation to stores or end users. While most of the products make it to the distribution centers on time, some do not make it that far, either due to poor shipment processes, poor quality or even damaged goods. Automation helps cut down on this process by making sure that goods are shipped on time, to ensure that customers receive their goods on time, whatever the reason for the delay.

As mentioned above, the other part of the supply chain involves returns. Goods that are improperly returned or do not meet standards for defect and quality may never be sold again, because no one wants them. This results in a revenue loss, and in some cases, loss of the company entirely. Automation helps cut down on defective goods, because it ensures that only 100% quality goods go back into the distribution lines. What is reverse logistics?

The supply chains that involve the return of goods include inventory, warehousing, and collection. Automation helps streamline these processes and cut down on lost revenue and lost profit. For example, manufacturing facilities that deal with returned goods handle the logistics of storing and retrieving products that are returned, as well as packaging them and repackaging them so they can be sold again. This streamlining results in lower costs for companies, because they don't need to hire more employees to handle the storage, gathering, and storage of returned goods. What is reverse logistics? It's the automation of the supply chains used in order to cut down on lost sales and improve quality, capacity, and efficiency of the distribution.

In order for a logistics system to really work and be effective, there must be a good plan in place in case something goes wrong. Companies have started to use best practices for their logistics, such as using inbound logistics to handle return traffic and handle returns on goods that have been returned. Best practices for inbound logistics include keeping a good eye on your product inventory, handling returns promptly and following any returns requirements that may arise from packaging and shipping the product. What is reverse logistics? It's the automation of the best practices used to improve supply chain efficiency and cut expenses so that companies can offer the best services to their customers at the best prices possible.

The most important thing about an efficient return policy is that it's effective. When retailers can't manage or guarantee an effective return policy, they're not doing their customers any favors. And when customers aren't happy with the service they receive, they'll likely go elsewhere for a more efficient and professional return experience. A lot of small retailers have adopted best practices for handling returns, and many large retailers are beginning to follow suit. So you can see, there are some major opportunities in implementing a return policy that's both efficient and profitable.

For example, department stores, discount retailers, and niche retailers, such as Macy's, Target, Home Depot, Rite Aid, and Walmart, have very liberal return policies, since their aim is to keep their customers for life, and therefore will accept returns that are even damaged. The question is what to do with these returns. If the retailers were to reintroduce these returned products into their stores, they would seen see their image tarnished in the eyes of their costumers. So instead of restocking their returns, or simply throwing them out and taking a complete loss, these retailers will utilize the services of liquidators and auctioneers, such as,, and Genco.

There can be a great opportunity for retailers and wholesalers to purchase these liquidated goods and sell them through their own sales channels, whether it's their own stores, websites, eBay stores, Amazon seller accounts, or by exporting the merchandise to other countries.