Logistics Industry November 9, 2009
Uncovering the Truth about Returns Management
The Reverse Logistics Association defines reverse logistics as, 'all activity associated with a product/service after the point of sale (POS). The ultimate goal is to optimize or make more efficient aftermarket activity, thus saving money and environmental resources.'
Managing returns in logistics companies has not been emphasized in the past and has now become a forced, and often costly, 'secondary' core discipline where processes have not been implemented to conform to the idea of ERP (efficient returns process). A 3PL must develop an ERP. A 'customer centric' approach will provide a quick, accurate, and proficient process that handles this complex and unglamorous branch of logistics.
What activity is conducted by a 3PL when a Return is Received?
Typically, a quality 3PL has a quick and proficient method of determining overages, shortages, and damages and communicates these findings to the client with pictures if necessary.
A visual and quality inspection is conducted to determine if the product is saleable or damaged.
If the material returned is damaged and/or not environmentally conducive logistics companies have the option to dispose of the product and can provide the client with a certificate of 'Destruction and Destroyed' for authenticity purposes.
Often returns are repacked, reworked, and or returned to the vendor.
Information, Information, Information!
A 3PL will often require an RGA (Return Goods Authorization number) that is provided by the client to track the quantity and product received. Providing a packing slip denoting what to expect with the shipment is critical. The client has to be aware of certain limitations that can impede a 3PL's progress when receiving returns and therefore we ask that details of disposition for your returns be provided as soon as possible.
Benefits of Utilizing a Reverse Logistics Program
Logistics companies with proven reverse logistics experience and specialized skills can frequently find savings, increase efficiencies, and improve services that their clients may not be able to identify on their own. A returns management policy should encourage the client to get their product into saleable condition as soon as possible, saving the client money and by keeping inventory in impeccable condition. In the end, creating a streamlined process to manage returns can increase a company's bottom line.