Elements of Manufacturing, Distribution and Logistics (original) (raw)

Reverse logistics is the process of managing the operations concerned with any returned goods to the manufacturer. On average, near 5 % of the goods sold are returned to the original manufacturer for a variety of reasons as: worn out goods, damaged goods, unsold goods, recall goods, and so forth. The manufacturer is obliged to receive and process the return goods seeking any revenue that can be gained, or arranging for proper disposal. The role of processing return goods has expanded ever more as the environmental mandate of industrial growing green has gained strength. In the typical forward logistic way, the goods final destination is with the customer. As the goods become old, they may be replaced and returned to the manufacturer to begin the reverse logistics cycle. The returned goods are mostly one-model-at-a-time occurring in a disjointed manner. The return process is costly, perhaps 10 % of the total cost of the original sales price, requiring the manufacturer to seek as much value from the item as possible. In the typical situation, the returned goods are cleaned, tested for worthiness, and if accepted, are repaired and refurbished for resale. When not accepted, they are disposed in the proper manner. The return goods are often from various reasons: worn out and no longer usable goods; damaged goods from shipment or use; new goods that are unsold at the retailer; goods ordered on the internet with cash-on-delivery terms and payment refusal when delivered; recalled goods; discontinued goods; and so forth. The returned items are also from warrantee claims, some from fraudulent claims, and some are stolen goods. Other return goods are of the reusable type whereby they are recycled after cleaning and repair. These include: pallets, containers, packages, bottles, cans, cylinders, and the like. Two examples are described. The first concerns appliances where a customer purchases an appliance, and later in time, the unit does not operate properly and the defective product is sent back to a return facility that refurbishes the product as new for future use. The second pertains to the automotive industry from the truck