Reverse Logistics

Structured Literature Review

Term Paper, 2014

19 Pages, Grade: A


Table of Content

List of figures and tables

1. Introduction

2. Definition of Forward and Reverse Logistics
2.1 Forward Logistics
2.2 Reverse Logistics
2.3 Comparison of Forward and Reverse Logistics

3. Drivers and benefits for companies implementing Reverse Logistics operations

4. Impacts of Reverse Logistics

5. Conclusion

List of references

List of figures and tables

Figure 1: Reverse logistics flow

Figure 2: Relationship between reverse and green logistics

Figure 3: The Reverse Logistics Hierarchy

Figure 4: Supply chain flow with waste and reverse logistics

Table 1: Options for product recovery

Table 2: Characteristics offorward and reverse logistics

Table 3: Key drivers for reverse logistics

Table 4: Summary of the literature related to environmental impacts

1. Introduction

Throughout history, business enterprises paid more attention on maximising their benefits than thinking about what happens beyond the product lifecycles (Vahabzadeh and Yusuff 2012). Therefore, little research was conducted on the impact of returns from the marketplace and the consequent influence on sustainability (Department for Transport 2004). However, due to shorter product lifecycles and an increasing interest in green supply chains (SCs), the recovery of value after the return of products is becoming of paramount interest (van Hillegersberg et al. 2001, Mishra et al. 2012). Moreover, the rise of online shopping and home deliveries, the growing necessity of making efficient use of transport and particular regulations lead to an increasing importance of reverse logistics (RL) (Simchi-Levi et al. 2009, Unipart Logistics 2013).

This assignment reviews the literature of RL. In order to structure the research, the following research questions were developed:

- Which activities are covered by RL and what differentiates it from forward logistics (FL)?
- What are the drivers and benefits for companies implementing RL operations?
- What are the impacts of RL on the SC and how does it contribute to green the SC?

The motivation for conducting this research has several origins. Firstly, the research on RL is limited. Secondly, businesses are increasingly confronted with a throw-away mentality of the society. This makes a modification in the behaviour towards the environment necessary (Cherrett et al. 2012).

In order to study the development and impact of RL, this assignment reviews a large variety of literature mainly in different trade publications, journals and books. To identify relevant literature, searches were performed in the databases Discovery, Google scholar and in the library of the university related to the criteria 'reverse logistics'. The main keywords used during the search of relevant literature were reverse logistics, green reverse logistics, return management and closed-loop systems. Other relative words such as green logistics, supply chain management (SCM), reuse and recycling were used to supplement the search. The initial collection was based on the above mentioned keywords. Considering the timeliness of the field of RL, only literature published in the last two decades was included. After screening the literature thus obtained, bibliographic details were further used in order to complement the data set. There are several streams of literature related to the field of RL: elements, drivers, impacts and challenges of RL, contribution to green the SC, impact of returnable assets, network design and the role of transportation and warehousing.

2. Definition of Forward and Reverse Logistics

This chapter emphasises the outcomes of the first part of the structured literature review and answers the first research question.

Research into sustainable development in logistics has focused largely on how to improve FL, i.e. especially the deliveries of products from the manufacturer to the customer through the overall SC were investigated. Therefore, it is crucial to understand the different operations that are part of the SC. However, both types, i.e. FL and RL are fundamental parts of the SC. The players in FL are suppliers, manufacturers, wholesalers, retailers and end customers. In contrast, recycling specialists, sector organisations and dedicated operators of special pools are key players in RL (Rushton et al. 2010, Stock 1998).

2.1 Forward Logistics

Although the term logistics was already introduced in the 1990s, there exists no general definition in the literature as discussed by Hesse and Rodrigue (2004). The Council of Supply Chain Management Professional (2013) defines logistics as follows:

The process of planning, implementing, and controlling procedures for the efficient and effective transportation and storage of goods including services, and related information from the point of origin to the point of consumption for the purpose of conforming to customer requirements.

The definition meets the overall explanation of logistics and considers the direction of flow. Blumberg (2005) further announced that FL contains the coordination, management and control of the logistics pipeline, the movement of resources, components and manufactured products from suppliers or producers to warehouses, retailers or end customers.

2.2 Reverse Logistics

Comparable to FL, there exists no general definition of RL. A definition put forward by Tibben-Lembke and Rogers (2002) respectively presents the processes of RL.

They define it as follows:

The process of planning, implementing and controlling the efficient, cost-effective flow of raw materials, in-process inventory, finished goods and related information from the point of consumption to the point of origin for the purpose of recapturing or creating value or proper disposal.

This definition provides a comprehensive view of the diversity of included activities and emphasises the direction of the product flow as shown in Figure 1. Another approach by de Brito et al. (2003) differs from the above mentioned definition as products are not only returned to their point of origin but also to other places to provide recovery.

Abbildung in dieser Leseprobe nicht enthalten

Figure 1: Reverse logistics flow (adapted to Grenchus et al. 2001)

Stock (1998, p.20) extended the term as it describes "product returns, source reduction, recycling, material substitution, reuse of materials, waste disposal, and refurbishing, repair and remanufacturing". Kroon and Vrijens (1995) also state the overall aim of reduction, management and disposition of waste from commodities and packaging in their definition.

When the RL business model operates dependently of the SC which originally delivered the products, it is also known as a closed-loop system.There are many reasons for product returns, for example "commercial returns, warranty returns, repairs, end-of-use returns, and end-of-life returns" (Guide et al. 2003, p.5).

RL can further be defined as a part of green SCM as discussed by Srivastava (2007) who categorised the literature into the fields of green operations, green design and the literature emphasising the importance of green SCM. The majority of activities in the area of green operations are related to RL. Further demonstration of the key role that RL plays in green SCM is provided by the results of a study conducted by Murphy and Poist (2000). Rogers and Tibben-Lembke (2001) also describe an overlap between green and reverse logistics (Figure 2). Especially, the end-of-life product disposition activities that provide environmental-friendly outcomes are shown to be considered both RL and green SCM concepts. However, they only differentiate between recycling, remanufacturing and reuse.

Abbildung in dieser Leseprobe nicht enthalten

Figure 2: Relationship between reverse and green logistics

(extracted from Rogers and Tibben-Lembke 2001)

Stock (1998) further discusses the essential role of logistics when implementing sustainable development approaches and programs through citing Giuntini and Andel (1995). The authors recognised six activities specific to logistics which are key elements of any RL process, as opposed to Rogers and Tibben-Lembke (2001) who only identified three activities as mentioned above. These six elements are receiving of materials (recognition), review, recovery and renewal of materials to increase the product life cycle, removal of material from systems and identifying ways in which the RL process can be developed or modified to maximise efficiency and effectiveness (re-engineering).

Thierry et al. (1995), cited in Chan et al. (2012, p.1320), pointed out five options for product recovery, which are "repair, refurbishing, remanufacturing, cannibalisation and recycling" as defined in Table 1. Moreover, direct recoveries such as re-sale, re-use or re-distribution are possible (de Brito et al. 2003).

Abbildung in dieser Leseprobe nicht enthalten

Table 1: Options for product recovery

(adapted to Beamon 1999, Chan et al. 2012, van Hillegersberg et al. 2001)

Van Hillegersberg et al. (2001, p.76) define recycling as "bulk and low value-adding processes" and refurbishing and remanufacturing as "specialized low-volume but high value-adding processes". Regardless the reason for returns and the type of recovery, companies may recover some value from the returned products when carrying out RL processes properly instead of disposals in landfills (Chan et al. 2012).

Figure 3 shows a RL hierarchy based upon the work of Stock (1992). Due to the hierarchy, companies should seek to reduce resources in the RL process, i.e. minimising the amount of materials used in a product as the design of more environmentally friendly products leads to a reduction of waste and energy spent. Once this option has been exhausted, the maximisation of reuse and recycling should be attempted. The last option should be disposal, i.e. to dispose of a product through disposal at a landfill or incineration (Stock 1992). Kopicki et al. (1993) also agree with this hierarchy. According to them, reusing items can result in reduced purchasing, transport and disposal costs whereas recycling just reduces costs for disposal. Regarding this concept, a hierarchy of product disposition including reduce, reuse and recycle has been recommended therewith minimising the effect of returning products as discussed by The Department of Transport (2004), cited in Cherrett et al. (2012). Christopher (2011, p.250) termed it "the 3Rs of sustainable supply chain management".

Abbildung in dieser Leseprobe nicht enthalten

Figure 3: The Reverse Logistics Hierarchy

(adapted to Carter and Ellram 1998)

Despite numerous existing options for product recovery, companies often do not actively manage their RL. Moreover, instead of considering RL as a business process, many companies attend a silo approach, i.e. they consider it as independent operations and activities (Guide et al. 2003). Many researchers, however, are increasingly looking at ways of integrating the management of product flows in different directions as discussed by McKinnon (2012). In order to provide an efficient workflow, a company must create appropriate strategies for collection and recovery processes. Therefore, companies need to understand the different characteristics of FL and RL (van Hillegersberg et al. 2001).


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Reverse Logistics
Structured Literature Review
Heriot-Watt University Edinburgh
Green Logistics
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reverse, logistics, structured, literature, review
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Janina Bohling (Author), 2014, Reverse Logistics, Munich, GRIN Verlag,


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