The returns process begins with customer support. Warranty management and product support are often outsourced. Contracts for asset transportation are often managed by this group that manages product returns. Throughout the reverse logistics cycle, an asset may be moved more than seven times—sometimes overseas and back in containers.
The review process begins with triage. It is generally performed at the point of return—though it may be outsourced. While also performed in triage, general practice is to inspect the product. Triage options may include: repair and return to user; return to stock—no issue found; repair and refurbish or send to salvage. Each of these options may involve different service providers and practices.
Depending on the product category, certifications, authentication, test equipment, and trained staff may be required. In some cases, products may be cycled into remanufacturing.
This task may be performed either by the repair facility or the reseller as per contract. It may require special equipment including labeling processes. Different packaging requirements are set for assets to be resold and those assets that are moved in bulk. Often, they are re-kitted to add value for resale.
Different channels for the secondary market exist for B2C, B2B, Brick & Mortar, and ecommerce outlets. Some primary vendors also resell refurbished goods. The secondary channel may be responsible for product support and warranty on refurbished products. Liquidators often act as intermediaries. These are key components of the circular economy.
At the end-of-life, an asset can be harvested or re-purposed. Salvage value can be significant. For some products, there are a returned-goods market, e.g. cell phones, while others may be upcycled for creative reuse.
The industry goal is to eliminate landfills. Some manufacturers claim landfill usage is as low as 1% of product weight. Recycling often requires shredding or other processes to certify destruction and/or create raw materials.
The RLA Advisory Board is comprised of member companies that have a global reach of products and services, and who have been in the RLA for at least 1 year. Board companies provide senior level company representatives who are active with the RLA in multiple capacities such as Committees, research, speaking roles, sponsorships, etc. Board members support and participate in RLA events around the world and support RLA membership at the Gold or Platinum levels. Board members serve for a 3-year term and can be re-elected to the board by the member companies.
Tony Sciarrotta, Executive Director of the RLA, states that the increasing rates of returns and reverse logistics are not sustainable for most companies, or long term for the planet. Consumer surveys of those who returned products previously identified as much as 75% were because “product did not meet expectations”, and very few returns were for actual defects. With the growth in e-commerce, returns and reverse logistics costs are significantly growing as hassle-free and freight-free processes are mandatory to sell goods online. Manufacturers and retailers must find ways to reverse this trend. The Reverse Logistics Associations provides members with best practices and ideas to reduce that increase, as well a growing number of service solutions providers to help implement new program to reduce returns and increase asset recovery.
Each member of our RLA team is a specialist in the returns and reverse logistics industries.
We are committed to educating and bringing together individuals and organizations to address their
reverse logistics needs.
Reverse Logistics Association
2300 Lakeview Parkway
Alpharetta, Georgia 30009
Toll Free: +1 866-801-6332
Fax: +1 866-216-8672
Our first market research on founding the Reverse Logistics Association was started in July 2002. Actual incorporation of the company occurred on October 28, 2002. Initial analysis was conducted primarily with three major Manufacturers and two Third Party Service Providers (3PSPs).
After the early studies were completed, it was determined that more than $750 billion was being spent annually on the Reverse Logistics Processes in North America alone.
Our research discovered that there were thousands of 3PSPs worldwide that were providing support services to OEMs, ODMs, Branded and Retail companies! Today the Reverse Logistics processes represent 3-15% of the Gross Domestic Product, which is estimated between $360 billion and $1.8 trillion (based on 2017 data).
Our research also showed that there wasn’t any common thread between any of the 3PSPs other than competition. The OEMs, ODMs, Branded and Retail companies had no platform for discussing “best practices.”
We also could not find any tradeshows, magazines or trade associations that existed to support this growing segment of the Aftermarket Supply Chain, or as we call it today, Reverse Logistics.