Supply Chain Management and Planning
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Review the Scenario. One of Advantec's primary clients, Johnson Automotive (an automotive holding company) provides key parts to one of the big three manufacturers; they are seeking methods to improve and optimize its return parts channels. They provide electronics, batteries, and paint products to their clients. Assume Johnson currently uses outdated methods of supply chain management (limited technology and processes). Using the Library and other resources, do the following:
Define reverse logistics and explain it.
Highlight key elements of return management or reverse logistics channel for the automotive industry - how are they different than other industries? Identify the unique aspects of this industry.
Explain any issues associated with reverse logistics for each of the individual types of components provided by Johnson Automotive (electronics, batteries, and paint products).
Explain how Johnson can optimize its reverse logistics channel. Is there any opportunity to provide competitive advantage through reverse logistics for Johnson Automotive, and what would it be?
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Solution Summary
The solution examines supply chain management and planning for an automotive company.
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Running Head: REVERSE LOGISTICS
Reverse Logistics
Reverse Logistics
Reverse logistic can be defined as the knowledge of recyclable and reusable products and growing awareness among all the companies (Dekker, Fleischmann, Inderfurth & Wassenhove, 2004). In addition, the increasing regulatory pressures on present companies to produce recyclable products in order to reduce landfill waste, the opportunity to lower costs by reusing packaging material and the potential to improve customer relations by reclaiming damaged products have led to the increasing focus on reverse logistics (Kroon & Vrijens, 1995).
In simple manner, Reverse logistics is a process of receiving return goods from the customers and credit a return for the customers. It also includes the activities of determining product status and packaging the product such that recyclable and reusable material is delivered to the manufacturer (Linda, 2002).
As more and more materials enter in warehouses as part of returned goods, there is an increasing need for them to efficiently plan out cost-effective methods to handle the freight, receipts, claim processing, credit notification and disposal of the goods and the labor associated with it (Dekker, Fleischmann, Inderfurth & Wassenhove, 2004).
As we all know that, reverse logistics precedes goods from their distinctive concluding destination for the aim of appropriating value or proper dumping. It is actually a "backward" logistics process that considers products, their transport instrumentalities and packaging stuffs (Reverse Logistics: Backward Practices that Matter, n.d.). It can also be defined as a process of planning, implementing, and controlling the effective, cost effectual course of raw materials, in-process inventory, finished goods and associated knowledge from the tip of consumption to the tip of beginning (Schatteman, 2009).
The significance of reverse logistics departs from the type of industry and its channel perspective. It is very significant for the automotive industry according to the Auto Parts Remanufactures Association who had estimated that raw materials preserved by remanufacturing universal would fill 155,000 railroad cars yearly and form a train over 1,100 miles long (Dekker, Fleischmann, Inderfurth & Wassenhove, 2004). The management of reverse logistics for an ...
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