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    Reverse Logistics

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    We return to the hypothetical grocery delivery business described in Case 1.
    If you buy a defective computer, then it's a given that you're going to take it back to where you bought it, either to be repaired, replaced, or returned in exchange for a refund. If you buy a net of onions that has some moldy ones in it, then it's a given that you'll simply throw them away. Taking them back to the store isn't worth the trouble.
    In the case of MyShoppingCart, the situation is a bit more complex. Your customers are paying a high premium for fast, 24/7 delivery of groceries. If a Silicon Valley matron gets a corked bottle of pinot grigio, or a tin of pate de foie gras with an unwholesome aroma, then she expects your company to come get it, and credit her account.
    This is an example of reverse logistics, which your readings describe as "a supply chain opportunity." But you're having difficulty finding any opportunities in the smelly bags of spoiled groceries that turn up at your warehouse from time to time. This problem is a lemon. Your challenge - to make lemonade!
    Carefully examine the situation, and discern any opportunities to profit from the returns, or at least earn enough money to offset the losses. Here are some clues. You bought the products from somebody, right? Maybe they're good for it. Also: information about product quality is valuable, at least in principle. How could you monetize that value? Who would be interested in seeing that information, and what could you gain by providing it to them?
    Be sure to provide citations and references.
    BizForum (2015). Reverse logistics - A supply chain opportunity. Retrieved on 13 Jan 2015* from http://www.bizforum.org/whitepapers/CSC-3.htm
    Hawks, K. (2006). What is reverse logistics? Retrieved on 13 Jan 2015* from http://www.rlmagazine.com/edition01p12.php
    Malone, R. (2004). Closing the supply chain loop: Reverse logistics and the SCOR model. Retrieved on 13 Jan 2015* from http://www.inboundlogistics.com/cms/article/closing-the-supply-chain-loop-reverse-logistics-and-the-scor-model/
    WFP (2013). Reverse logistics (a module of the World Food Program's Logistics Operational Guide). Retrieved on 14 Jan 2015* from http://log.logcluster.org/exit/reverse-logistics/index.html

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    Solution Preview

    A supply chain starts with suppliers who supply other suppliers. These suppliers then either go through distributers or deal directly with business customers. The supply chain then continues as the product reaches the end user; however, the supply chain does not stop there—the supply chain continues until the products have been fully accepted by the end user. Any dissatisfaction with the product or the delivery service may cause the product to be returned, and the supply chain will continue on, until the the necessary remedies have been completed.

    The article "What is reverse logistics?" by Hawks, K. (2006), describes reverse logistics as:

    The process of planning, implementing, and controlling the efficient, cost effective flow of raw materials, in-process inventory, finished goods and related information from the point of consumption to the point of origin for the purpose of recapturing value or proper disposal.

    In the case of MyShoppingCart, since the ...

    Solution Summary

    The expert examines reverse logistics. The hypothetical grocery delivery business described is determined. The solution is answered in 589 words.