Returns in the Retail Supply Chain with a Specific Focus on Ecommerce

Forward and Reverse Logistics

In the supply chain, there are two unique and distinct process flows, forward and reverse logistics.

While forward logistics handles the onward movement of product from the manufacturer to distribution center (DC) to final customer, reverse logistics masters the complex world of consumer and retailer returns.

There are third-party logistics (3PL) providers who only operate in reverse logistics, however many forward 3PL providers offer an element of reverse logistics processing in their service portfolios.

In recent years, the rise in e-Commerce sales has led to an increase in the number of items returned.

A 2015 study conducted by the National Retail Federation, revealed that on average 8% of goods purchased were returned, adding up to nearly $260 billion dollars in product.

This increase in returns created a challenging situation for retailers and an opportunity for their 3PL providers.