Reverse Logistics

Advanced Solutions for Effective Reverse Logistics Strategy

Implementing an efficient reverse logistics strategy is integral for any organization that sells direct-to-consumer. Historically, reverse logistics has been an arduous and often neglected process for retailers. However, as online purchasing rapidly increases in popularity, customer expectations regarding easy returns and exchanges are increasing too. To stay competitive in the age of same-day shipping, businesses must implement modern and efficient supply chain solutions. 

Optimizing reverse logistics strategy offers businesses a profitable opportunity to provide quick, hassle-free service to customers and increase brand loyalty. Additionally, an efficient reverse logistics strategy allows returned product to re-enter available inventory with haste, avoiding out-of-stock scenarios and decreasing operating costs. For mid-size and large organizations, this typically involves automation.

What is Reverse Logistics? 

Reverse logistics refers to the process of managing product traveling backward through the supply chain. This includes a variety of scenarios like processing returns and internally reusing or discarding packaging material. Additionally, it can include selling surplus materials and accepting returns of leased equipment or machinery. 

Put simply, the reverse logistics process encompasses procedures involved in moving inventory from the end consumer back to the retailer or manufacturer. So, what does this mean for a busy distribution center? Here are examples of reverse logistics activities:

  • Returns

  • Exchanges

  • Remanufacturing

  • Delivery failure

  • Product repair

  • Leased equipment returns 

Common Reverse Logistics Challenges

Reverse logistics has a reputation for being arduous and costly, but automation can solve many issues traditionally associated with these procedures. Challenges typically center around ineffective supply chain infrastructure unable to efficiently track backward-moving inventory. Many businesses also struggle with the cost of accepting returned products and storage of warranty data for easy reference during the repair or replacement of products. 

These challenges can create a poor experience for customers and result in loss of business for organizations unable to meet consumer expectations. To avoid losing customers and profitability, more companies are turning to warehouse automation as a solution.

Benefits of Effective Reverse Logistics Strategy

The benefits of implementing effective reverse logistics are numerous, although many distributors and retailers are just now realizing its value with the advent of same-day and one-day shipping from giants like Amazon. Some examples of how optimized strategy can add value include: 

Reduced Costs

A major benefit of optimizing reverse logistics, this perk stems from decreased financial burden related to fraudulent returns, storage, transportation, shipping, and returns labor. When returned products are processed efficiently, companies can assess and re-enter them into available inventory for faster resale.

Improved Customer Satisfaction

When customers can easily return, replace, or repair products, satisfaction improves significantly. In the age of online reviews, this is paramount. In a study by UPS, 95% of customers conveyed that they would not return to a brand after experiencing a negative returns process. Conversely, heightened customer service due to efficient reverse logistics strategy creates brand loyalty and positively impacts company image.

Increased Competitiveness

Mid-sized retailers lacking modern warehouse equipment and processes struggle to compete with larger global sellers offering hassle-free returns and repairs. By optimizing and updating distribution centers with automation, these organizations can maintain and grow customer bases. By providing a returns process on par with large companies, smaller organizations stay competitive while still offering personalized or local products customers love.  

Reduction in Waste

Now more than ever, businesses that practice eco-friendly logistics garner positive publicity and customer retention. Companies that optimize their supply chain to accommodate reverse logistics reduce waste and form sustainable practices. 

Types of Automation and Software Solutions

SSI SCHAEFER offers many products to assist organizations through the process of modernizing reverse logistics strategy. Our team of experts and products are trusted by some of the largest companies in the world. SSI SCHAEFER technology allows product to become available for rapid resale after inspection.

WAMAS Warehouse Management System

WAMAS Warehouse Management Suite is a complete line of warehouse automation software from SSI SCHAEFER. This type of software helps retailers and manufacturers accurately receive goods and control the internal flow of materials. Especially helpful when dealing with reverse logistics, a reliable WMS offers complete inventory visibility. This allows organizations to receive and track returns, repairs, and replacements throughout multiple facilities.

SSI Carrier

Used in a variety of industries for reverse logistics handling, the SSI Carrier is a pouch sorter that gently transports items up to 3 kg. Especially suited for e-commerce, retail, apparel, and pharmaceuticals, the SSI Carrier stores high-demand returned goods directly in the dynamic buffer after inspection. Immediately returned to the system for resale, these goods are swiftly available for new orders – saving time and labor while avoiding out-of-stock situations.

Goods-In Workstations

Incoming goods workstations provide efficient warehousing of materials – even in high-volume environments. Helping to reduce stress on employees while decreasing errors, goods-in workstations can increase productivity up to 20%. Additionally, incoming goods workstations allow for quick processing of returns and replacements. Product is put back into storage and available for resale with this ergonomic model.

Need more information?

Contact SSI SCHAEFER today to speak with an expert about optimizing your organization’s reverse logistics strategy. Trusted since 1937, SSI SCHAEFER is equipped to provide automation solutions for companies in a variety of industries.

Additionally, download the SSI SCHAEFER E-Commerce Best Practice Guide for more information on reverse logistics technology. You may also download the Stockmann case study, detailing how SSI SCHAEFER partnered with a large Finnish apparel retailer to provide efficient automated solutions.