A large part of the processes related to the reverse logistics takes place in warehouses. Warehousing processes, related to reverse logistics can be categorised into goods receipt, inspection, sorting, stock keeping and transportation. Warehouses support returns management, remanufacturing, remarketing, recycling and disposal.
Return management is responsible for the recalls and return of products, which have not been sold. Remanufacturing is commonly done in the warehouse, where the product is repaired or separated into component parts after the end of its useful life, followed by further sale at a lower price. Remanufacturing is common in automotive and electronics industry. Remarketing deals with reselling and positioning the products, which have been returned by the original customers, who no longer need them. This practice has been extensively used by the Defence Logistics Agency to sell outdated equipment to other military and governmental organisations. Recycling is responsible for decomposing products into the materials they are made of, such as paper, plastic, metals after their useful life comes to an end. Finally, when a product can no longer be reused or recycled, reverse logistics takes care of the safe disposal.
Reverse logistics deals with the inventory, which can be divided into controlled and regular. Control inventory refers to the products, which present hazards or may impact health of the consumers and environmental. In this case, proper disposal and profound operational control are mandatory. Recommended inventory is usually reclaimed due to transportation and warehousing damages or due to the end of its useful life. The processes supporting reverse logistics in the warehouse are more manual, then those for forward logistics. Incoming products often lack proper identification and order management. They are often packaged individually and incorrectly, requiring manual inspection and sorting, unlike the forward flow of palettes and cases. However, despite the complexity of reverse logistics, conducting it in the warehouses can bring significant cash flows and cost recovery.
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