It's no secret that managing the product returns supply chain is different from handling the traditional outbound, or "forward" logistics, function—a fact that makes "reverse logistics" daunting to many practitioners.
You can add this to the list of challenges: Many returns contain hazardous materials, an inconvenient truth that often goes unnoticed by retailers.
For manufacturers, this is generally not a problem. They know their products' properties and handle returns in compliance with the laws and regulations that govern hazmat transportation, distribution, and storage. Retailers' employees, though, don't always recognize the potential hazards inherent in some consumer products. As a result, they may unknowingly violate federal laws and regulations.
Such ignorance puts companies at risk for penalties, lawsuits, employee injury, and property damage. And the risk isn't going away. Due to retailers' increasingly liberal returns policies, the volume of hazardous consumer goods in the reverse logistics stream is likely to increase, according to experts. Consumers' "voracious appetite for consumer electronics and the shrinking lifespan of these devices" means that hundreds of millions of potentially hazardous products are returned or discarded annually on a worldwide basis, says Joe King, vice president of sales, aftermarket solutions, for third-party logistics service provider ModusLink.
That's why it's more important than ever that reverse logistics operations be fully compliant with hazmat laws and regulations, not only at the warehouse or returns center but also at the retail store level. Costly though that may be, the potential consequences of failing to ensure compliance—possibly life-threatening injuries to employees and customers, lawsuits, enormous fines, and damage to facilities—are far worse.
Here's a look at the extent of this troubling situation, the reasons behind it, and what can be done about it.
Here are some resources for information on reverse logistics for hazardous products.
A surprising number of consumer products are regulated as hazardous materials. Some, like household cleaners and solvents, are fairly obvious, says Keith Anderson, senior director of regulatory compliance for Inmar, a third-party logistics company. But the average person may not think of items like health and beauty care products, aerosols, and batteries as hazardous, he says.
Most consumer electronics, including televisions, cameras, mobile handsets, computer monitors, and printers, contain materials that could be considered hazardous, says King. "Televisions, for example, are built with electronic circuit boards, glass, and color cathode ray tubes (CRTs), which often contain hazardous materials such as lead and mercury, as well as lesser-known toxins like cadmium, chromium, antimony, beryllium, and brominated flame retardants," he explains.
Sometimes only parts of consumer goods are subject to regulation, says Robert Jaffin, who teaches an online course in hazmat reverse logistics for the American Public University. Seemingly innocuous components like the toner in printer cartridges or the ink in dry-erase markers become a health and regulatory risk when a commercial entity accepts them as returned goods, he says.
Some items that were not subject to regulation when purchased by the consumer may be hazardous when they are returned, notes Jack Currie, administrator of the Council on Safe Transportation of Hazardous Articles (COSTHA) and president of the regulatory compliance firm Currie Associates. Examples include construction, camping, and lawn and garden equipment powered by gasoline, kerosene, or propane. If these machines have been used, then there will be fuel, oil, and—most dangerous of all—volatile vapor in the fuel tanks, fuel lines, and engines, he says.
Regulated products that were properly packaged, documented, and handled when shipped to a retailer's distribution center often aren't recognized as hazmats when consumers return them. That's partly due to a lack of awareness among store associates, many of whom are working in part-time, seasonal, or high-turnover positions and may not have been fully trained in hazmat regulatory compliance or even overlooked altogether.
As a result, Currie says, it's common for customer service or stockroom associates to toss hazardous (and frequently incompatible) items in any handy cardboard box or returnable tote, and then return them—undeclared, unprotected, and often mislabeled—to a warehouse or distribution center.
The presence of hazardous materials in returned consumer goods poses both legal and safety risks for reverse logistics operations, experts say. However, steps can be taken to minimize those risks and comply with applicable regulations. While not a comprehensive list, the following tips from the experts we consulted for this article can get a company headed in the right direction:
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