A logistics operation wouldn't be complete without reverse logistics. This is the fine art and science of saving money in the process of handling returned products, fixing them, and hopefully pleasing customers with a speedy service. While it sounds easy, it's actually a hard task to accomplish.

If you do sell a product, always have a plan for reverse logistics. Even if you think you can get by with a simple mail and fix system, over time this will only count against you. Devise a plan on how you can simplify the process of returning products either to the manufacturer or to your own warehouse for fixing or scrapping. Often times, a manufacturer will reimburse fees associated with a defective product if guidelines are followed.

Shipping items back to the manufacturer for fixing or refunds doesn't always mean you will be reimbursed for the shipping charges. This is a good example of why you should consolidate returns when you can, as it cuts down on shipping costs. Consolidating returns may also mean that you should have some extra refurbished products handy, so consumers won't wait for the original item to ship back.

When you refurbish a product, you are simply fixing a problem that the consumer had with the product and returning it. This process requires that you have a team that is able to fix the product in question. If you do, factor in labor costs into the equation of lowering your logistics costs. If not, you should try factoring in the freight costs of getting the items back to the manufacturer instead.

Analyzing your operation is a constant task. You should never stop asking yourself what you could be doing to improve the operations of your reverse logistics. Always be looking for new ways to save money when accepting returns, refurbishing items, and getting better deals from the manufacturer who supplies the products. Spare parts and such should be bought in bulk to save more money on fixing costs.

Third party reverse logistics services can further save you time and money. These services will handle all of the reverse logistics operations for you. For a fee, they will also analyze your current system and strive for efficiency and suggest new modes of operation. Third party logistics services are available in most major cities, so you should have a fair selection when deciding upon a logistics partner to assign to your business.

Final Thoughts

Don't forget that business is a long process, of which takes much analyzing and knowledge to master. Over the months and years you will eventually arrive at a better business model, or you can skip the waiting game and ask for help from a logistics company near you.