Reverse distribution is also known as reverse logistics, return logistics and retro logistics. It is the process when a product is brought back to the producer or manufacturer, due to a faulty, damage or simply if the store carrying the product, has not sold it. Where as the regular logistics process can take place in four stages, one after the other, the reverse distribution process has additional stages, which allow the product to skip some of the four primary logistic points.
The four key moments of the logistics process are :
- Raw Materials - the moment in which the manufacturer possesses only raw materials, which are used to produce the good
- Manufacturing - in this stage, the raw materials have turned into parts, which will later on be assembled into the end product, wich wll be distributed
- Distribution - in this part the manufactured item, can be found in the trading point such as a retail store. However it can also be sold directly from the procucer, in which case, he is the distributor.
- Consumer - the last stage of the distributuion process - the end user of the manufactured product. At this point the consumer can decide whether he is satisfied with the product or not, in which case he is the first stage of the reverse distribution process.
Reverse distribution stages
As stated before, the reverse logistics process begins, with the moment in which the buyer acquires the item. The moment he starts using it is the so-called sort-test. It defines if the end user is satisfied with the product or not, and whether it requires further action. If yes, the possible outcomes in the third stage - processing - are as follows:
- Repair - the situaton in which the product has a faulty, is returned to the distribution point, fixed and ready to reuse.
- Refurbishing - similar situation to the repair scenario, however instead of a faulty, that required fixing, the product is renovated and ready to resue.
- Remanufacturing - in this case the products faulty lies in the manufacturing, therefore it is returned to the manufacturer, upgraded and ready to resue.
- Cannibalization - this process focuses on the recovery of reusable parts (which are identified as a restricted set), from the purchased item, which has been used. During this process the "end product" are raw materials, therefore in this scenario, a reuse of the bought item is impossile for the customer.
- Recycling - a similar process to canibalization, however this case involves the resue of materials which where the result of the subassembly, or used to be part of another product.
Reverse distribution and the environment
The reverse distribution process, was introduced, when companies, became more aware abouth their impact on the environment. It lead many firms to evaluate their processes, and operations in search for a soulution, which would help them become more eco-friendly. After investigating the issue it turned out that the main source of environmental problems, particularly noise and air pollution, are logistics. This caused more and more companies to implement reverse distribution, which not only results in the reduction of influence made on the planet, but also in an economic benifites .
- R. Kaynak, İ. Koçoğlu, A. E. Akgün 2014, p.439
- A. Ang , A. Tan 2018, p.522
- M. Şükrü Akdoğana, A. Coşkun 2012, p.1641
- Ang A. , Tan A. (2018)Designing reverse logistics network in an omnichannel environment in AsiaScientific Journal of Logistics, p.522
- Kaynak R. , Koçoğlu İ. , Akgün A. E. (2014) The Role of Reverse Logistics in the Concept of Logistics CentersProcedia - Social and Behavioral Sciences 109, p.439
- Şükrü Akdoğana M. , Coşkun A. , (2012) Drivers of Reverse Logistics Activities: An Empirical InvestigationProcedia - Social and Behavioral Sciences 58, p.1641
Author: Marta Marzec