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Reverse logistics as a success factor for companies!

Understanding how logistics works is of great importance for companies that dream of surviving in a highly competitive environment. They need to be prepared to achieve strategic objectives, and at the same time maintain a good relationship with their customers and stakeholders. After the chaos caused by the pandemic over the past two years, we continue to live even more economically troubled times and with an increase in taxes in sight. Also, we have to think about inflation and the migration flow of highly qualified people to richer and more competitive countries, leaving Portugal at the end of the list. We can only fight this trend when we develop optimistion and restructuring, develop new employee skills and implement efficient tools. Value chain optimization can create the necessary counterweight savings to predictable cost increases. The know-how of our implementation teams is extensive in the development of such programs and restructuring processes, including their hands on implementation on the ground. In our point of view, we must keep in mind that the management of the efficient “Value Chain” improves strategic relationships. By creating a long-term “Win-Win” relationship with stakeholders, we help the company’s performance and generate value. Traditional logistics is only a part of the management of the “Value Chain”. It assists through information flows, relying decisively on all business processes, whether through planning, implementation and control. Traditional logistics management is a direct management of the flow of products, ensuring that they reach final consumers quickly through the various distribution channels. Currently, products are increasingly in need of technical assistance, damaged, defective or recyclable ones. These products generate reverse flows, that is, there is a need to return these products from the final consumer to the original supplier. This activity is called reverse logistics, understood as a management of the opposite flow of products. Employees are engaged in their day-to-day work and routines and often are unable to systematically identify the problems. Experienced resources and well-applied methodologies allow you to identify the opportunities and create ways to improve the organization. The positive impact on the environment based on the triangle “buy-use-recycle”, is prompting companies to launch actions that only lead them to fit into the current Environmental Laws. Reverse logistics is analyzed by organizations on three perspectives: Economic, Environmental and Social. From an Economic point of view, it has contributed positively to the reduction of logistics costs, providing financial gains by reusing packaging or reusing products, thus contributing to the stimulus of new initiatives and new business. In the environmental, it was found that the reverse flow mitigates the damage of disposable products in the environment, contributing to sustainable development. The use of the Internet has helped the growth of product sales, further contributing to the increase in waste. However, we see a shortage of business policies for after-sales and even a certain lack of accountability about the final destinations of their products. Consumer pressure will force manufacturers to think about these issues. In a Social point of view, reverse logistics has helped the creation of new jobs in the implementation of solutions for the destination of products and their recycling. The circular economy begins to be spoken and discussed in society. Most customers only use the aftersales technical assistance during the warranty period of the purchased products. It is understood that the reverse logistics of the after-sales service is seen as a competitive strategy, requiring a good planning of the activities, and in this way, to retain the final customers of the product. We highlight companies that have well-structured and well-managed processes in reverse logistics, achieving competitive advantages, whether through efficient and differentiated service in relation to their competitors. We have checked in some of our customers with reverse logistics installed, several essential factors, from the return of parts, packaging, products sold / returned and even to the products used and / or recycled. We have seen an increase in the areas of returns in many logistics operators. Companies do not typically make a careful analysis of the situation. Usually, an increase in the deposit area, is a clear sign of the existence of unresolved outstanding issues and some disorganization. Although the reverse logistics service of operators is growing and competitive, we tend to notice a lack in management and the need for clear procedures to improve the services provided in the reverse channel. The increasing use of reverse logistics clearly shows that its use can trigger a competitive differential and help obtain extra revenues. Reverse logistics will serve as a basis for companies that want to insert in their portfolio a differentiated, optimized and with a revenue generating service portfolio. All professionals in the area and transformation agents, should search for knowledge in reverse logistics. There is a growing and increasingly complex market, characterized by the lack of specialized professionals, and mainly by a need for innovation with ideas out of the box.

Article by Paulo Vasconcelos Implementation Manager

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