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Reverse logistics and Indian scenario

Reverse logistics may include all operations connecting the reprocess of products and materials. It can be termed as the progression of planning, executing, and controlling the well-organized, lucrative course of raw materials, in-process inventory, finished goods and interconnected information as of the point of consumption to the point of source following recapturing value or appropriate clearance. Reverse Logistics may also contain remanufacturing and refurbishing activities.

Reverse Logistics Association of USA has described Reverse logistics as services and solutions for goods subsequent to the point of sales regarding confining / attaching value for the accurate disposition of the product / service. So all the post-sales services similar to Helpdesk, Depot repair, field support, Spare parts management, Replacement management, RMA, Fulfilment services, Recycling, refurbishment, screening, warranty management, asset management, etc. will be the part and parcel of Reverse Logistics.

 

If you consider Reverse logistics from supply chain perspective, you can define it as the total supply chain which caters to the reverse stream of products and materials to be utilized for materials substitution, waste handling, re-processing, re-manufacturing, repair and/or recycle. Here entire logistics system will include forward logistics and reverse logistics. The core enterprises of supply chains must apply latest information technology to formulate enterprises reverse logistics system. IT based reverse logistics system will greatly increase recovery and decomposition procedures and diminish the rates of reverse logistics management.

Reverse logistics may come in two different categories i.e. ‘asset recovery’ and ‘green reverse logistics’. Asset recovery is associated with return of real product and green reverse logistics stand for the liability of the supplier to organize the packaging material or eco friendly material.

Benefits:

If one can run reverse logistics effectively it will enhance the fulfillment of clients and increase the competitive advantages by returning the ineligible products well-times.

Reverse logistics management consists of well-built ecological features which may lessen the ecological contamination of products and resource consumption.

By reusing the waste products and packaging materials, Reverse logistics will decrease the materials costs of enterprises and enhance product competitiveness as well as trim down the return rate, the damage of resources. In this way reverse boost the competence of enterprises.

In order to extend scopes for reverse logistics, enterprises should give sincere awareness to reverse logistics and evidently recognize the connection of reverse logistics through recycling economy and sustainable growth policy. The government must also make stronger legislation for enterprises for developing the level of attention to reverse logistics. This will provide great support to manufacturing enterprises for taking responsibility for the complete life cycle of their products.

Average expenditure on reverse logistics is about 10-15% for garment firms and about 20% for furniture companies. There are also other sectors like retail, consumer electronics, automobile and pharmaceutical sectors for which the reverse logistics may be very useful. Non-governmental associations, corporate self ownership, joint venture operated and 3rd party service providers engaged with reverse logistics for their own or outsourced supply chain management.

Reverse logistics is in nascent stage in India. Here the scope for business is huge but there are high level of execution hazards. The Indian Govern is giving importance on sustainability which is a growth aspect of India's reverse logistics market. The government is trying to minimize e-waste that is increasing at a rapid rate as some companies and customers substitute products from mobile phones to computers that are becoming outdated more quickly. The government is also providing tax benefits and incentives, constant & fast pace infrastructure development for the growth of Reverse Logistics. With the growth in Indian economy, the reverse logistics has the potentiality for being a key route to cost optimization.

Author by: Rajib Dey

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