The importance of reverse logistics management in your warehouse

We’re seeing many high street shops close because of competition from the internet, and some of the hardest hits stores have been clothing retailers. Meanwhile, online clothes sales continue to grow rapidly. Huge amounts of warehousing and industrial storage has to be used, to satisfy online demand, and rush goods to shoppers. Most warehousing facilities have inward logistics plans. But in the age of internet shopping, that may not be enough.

Returned goods now a major factor in logistics

The reason is the level of returns, particularly in clothing sales. The BBC broadcast a market research report in which 1,000 shoppers, who had bought women’s clothing online, were questioned. Results showed that 66% of them had returned at least one item.

So for 1,000 movements out of the warehouse, as many as 660 movements back could be generated. It’s probably lower than that because not everyone returns every item, but it still gives some idea of the reverse logistics problem.

This level of movement has to be properly managed, by drawing up a plan to handle reverse logistics – items coming back into the warehouse. They have to be unloaded, recorded, checked, and either routed back to the supplier, or sent out to another buyer if they are in a saleable condition.

The situation is exactly the same in Ireland as it is elsewhere, and industrial shelving in Ireland https://www.rackzone.ie/shelving/industrial-residential-shelving has to be available to cope with this reverse flow, at the point in the warehouse where the returned goods are received.

Producing a reverse logistics plan

Drawing up a formal plan, rather than handling returns on an ad hoc basis, can help a business to see what costs are being incurred. These costs have to be met somewhere in the logistics model, and knowing the size of the problem can help with decisions on charges for returns.

The level of returns means that the inventory level is subject to much more fluctuation than previously, so you need to ensure that your inventory management system is correctly calculating current stock levels, by including the latest returns figures.

Handling returns efficiently, and always knowing where a returned item is currently located, will win repeat business from clients who are themselves struggling to keep up with the changes brought about by internet shopping.

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