Reverse logistics: No longer the cost of doing business

Amy Augustine and Steven Fulghum

Journal of Supply Chain Management, Logistics and Procurement, 2019, vol. 1, issue 4, 326-333

Abstract: U.S. Cellular Reverse Logistics has successfully shifted the paradigm of product returns being viewed as the cost of doing business to one that recognises and maximises the value that lies within returned assets. By launching an integrated reverse business planning process, capitalising on the concept of the circular supply chain and building dimensional intelligence to ascertain total cost of return asset acquisition, U.S. Cellular has proven that through building internal intelligence, establishing visibility into its returns ecosystem and optimising its reselling processes and disintermediating its resale supply base, it can improve the velocity of returned assets, maintain optimal in-stock levels of returns for after-sales service demand and maximise asset revenue recovery. The results from executing this dimensional strategy were so significant that the U.S. Cellular C-suite better understands how a sharp focus on the reverse logistics function, within a circular supply chain, generates value by positively impacting the bottom line. This paper is a case study as to how U.S. Cellular’s reverse logistics function evolved far beyond deflection strategies to lessen losses inherent to product returns. The reverse logistics function developed a multi-faceted, cross-functionally supported strategy that delivered end-to-end visibility of returned assets, the ability to plan and, thus, predict returned asset timeliness and volume and a data-driven competency incorporating these factors to accurately calculate cost and value for dispositioning returns. The resulting paradigm changed from returns being a cost of doing business to one that seeks to maximise value in all aspects of the reverse ecosystem.

Keywords: reverse logistics; returns; reselling; re-commerce; returns ecosystem; reverse ecosystem; circular supply chain; returned assets; smart devices; third party logistics; revenue recovery; secondary market reselling; continuous improvement; returned inventory; used equipment; returns redeployment; reverse strategy (search for similar items in EconPapers)
JEL-codes: L23 M11 (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:aza:jscm00:y:2019:v:1:i:4:p:326-333

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