Reverse Logistics Defined

The field of reverse logistics emerged during World War II.  With the rise of online shopping, the industry has achieved a newfound significance as ever-greater volumes of product flow through the existing reverse logistics channels.  The concept of reverse logistics is fairly simple to define; if forward logistics, commonly just referred to as “Logistics”, is moving a product from its source of manufacture to the consumer, reverse logistics is when that product moves from the consumer, or any other point in the supply chain where the forward movement of the product stops, backward in the supply chain.  Forward logistics, and the forward sales channels associated with them, are ill-equipped to manage this inventory.  Often the reason inventory begins to flow backwards is that the forward sales channels failed to sell through the amount of inventory on hand.  Subsequently, other sales channels have arisen to support the reverse logistics industry, generally selling that inventory at deep discounts to recover from it what value they can. 

Reverse logistics inventory most commonly consists of overstocks, warehouse damaged items, returns, undeliverable items, items near their sell-by date, and/or items past their sell-by date.

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