Reverse Logistics
Definition
Reverse logistics is the process of moving goods backward through the supply chain, from the customer toward the seller or manufacturer, for returns, repairs, recycling, or disposal. It covers everything from return shipping to disposition decisions.
In Practice
A reverse flow starts when a customer initiates a return and ends when the item reaches its final disposition: restock, refurbish, liquidate, recycle, or scrap. In between sit return authorization, inbound transport, inspection, and grading, each of which costs money against an item that has already been discounted by its trip.
For planners, returns are a real capacity and inventory problem, not an afterthought. Returned units occupy dock doors and processing labor, and slow disposition traps sellable stock in limbo. Speed matters: apparel returned in days can be resold at full price, while electronics lose value weekly.
A typical example is an online apparel retailer with a 25 percent return rate that routes returns to a dedicated processing center, where items are inspected within 48 hours and either returned to pickable inventory or moved to an outlet channel.
Related Terms
Last mile delivery is the final leg of a shipment's journey, from a local depot or distribution center to the end customer's door. It is typically the most expensive and operationally complex portion of the delivery chain.
Distribution CenterA distribution center (DC) is a facility designed to receive goods in bulk and rapidly redistribute them to stores, customers, or other facilities. Unlike a long-term storage warehouse, a DC is optimized for throughput and order fulfillment.
Proof of DeliveryProof of delivery (POD) is the documentation confirming a shipment was received at destination, traditionally a signed delivery receipt and increasingly an electronic signature, photo, or GPS-stamped scan. It establishes when, where, and in what condition goods were delivered.