Recession good for reverse logistics sector

Not too long ago, few companies paid much attention to reverse logistics—the management of merchandise returns (including repairs and final product disposition). These days, the financial benefits of reverse logistics are well known, and third-party specialists in the discipline abound.

So is there anything new going on in this field? There is indeed, as we learned during a recent conversation with Dr. Dale Rogers, chairman of the Reverse Logistics Executive Council and director of the University of Nevada, Reno's Center for Logistics Management and the Sustainable Supply Chain Management Project.

"I think this is a great time to be working in reverse logistics, because new models for managing it are being developed," Rogers said. "People really are thinking more about the end of life of products. Some of that is regulatory in nature, and some of it is because people are trying to be good stewards of the environment."

New (as yet unpublished) research by Rogers and his students also found that the economic downturn has spurred demand for reverse logistics services. The study showed that the recession has pushed so many people to shop in secondary markets—retailers that sell discounted merchandise—that those markets now account for 2.28 percent of U.S. GDP. That's a good sign for the profession. "Reverse logistics is the supply chain that feeds the secondary market," Rogers said. "In fact, reverse logistics processes are what make that market possible."