Written by: Ivaylo Iliev<\/strong><\/p>\n<\/div>\n Vice President of Engineering at\u00a0B-Stock Solutions, overseeing all technology-based aspects of the company.<\/p>\n <\/p>\n “Reverse logistics\u00a0is for all operations related to the reuse of products and materials. It is “the process of moving goods from their typical final destination for the purpose of capturing value, or proper disposal.\u00a0Remanufacturing\u00a0and\u00a0refurbishing\u00a0activities also may be included in the definition of reverse logistics.”\u00a0<\/span>Wikipedia<\/strong><\/p>\n<\/blockquote>\n <\/p>\n Technology will continue to affect historically offline industries. From fashion to food to how we book a hotel or hail a cab, disruption is inevitable and life-changing — both for the consumer and for the techie who created the technology. Obviously, some industries are easier to bring online: sexy, fun consumer-facing products are typically a quick sell. Yet for others, change is hard, and despite a glaring need to automate inefficient processes, there is significant pushback — most notably, a sentiment of, \u201cWe\u2019ve always done it this way, so why invest time and resources into changing anything?\u201d<\/p>\n This is why I find working to bring technology to the “others” so interesting — and necessary. I work in reverse logistics, which is how retailers manage the flow of returned and excess merchandise. It\u2019s an old-school, messy, awkward stepchild of an industry — a place where the sun (and technology) definitely doesn’t shine. But with skyrocketing return rates and record amounts of overstock — due to relaxed return policies, the spike in e-commerce (which brings higher return rates) and fickle buyer behavior — tech adoption is critical in the reverse logistics industry.<\/p>\n Here\u2019s why.<\/strong><\/p>\n Around\u00a0$260 billion<\/a>\u00a0in merchandise was returned to U.S. retailers in 2015, with another\u00a0$123.4 billion<\/a>\u00a0having been pulled from shelves or deemed excess.\u00a0Globally, returns and excess inventory cost retailers\u00a0$1.75 trillion<\/a>\u00a0annually. It\u2019s crazy to think that\u00a095% of this merchandise<\/a>\u00a0doesn\u2019t go back on the shelves but instead ends up sitting in a warehouse, taking up space, costing money and depreciating in value until someone decides to do something about it.<\/p>\n These manual processes to handle the reverse flow of inventory are unsustainable. The long, inefficient path alone is ridiculous: Items go from consumer to retailer to vendor to liquidator to jobber to reseller to a secondary end-user. Not only is this a logistical nightmare, but it leaves behind a pretty large carbon footprint: The transportation involved can span hundreds of miles, and 30% of the items will\u00a0end up in a landfill<\/a>.\u00a0<\/strong><\/p>\n Some more eye-opening stats:<\/p>\n \u2022 North American\u00a0E-commerce returns are\u00a0growing<\/a>\u00a015% annually.<\/p>\n \u2022 Over\u00a021 billion pounds<\/a>\u00a0of textiles end up in landfills annually.<\/p>\n \u2022 Due to brand concerns,\u00a0many companies<\/a>\u00a0choose to shred, incinerate or throw away items they can\u2019t sell as new “A-stock.”<\/p>\n Technology Is The Answer<\/strong><\/p>\n As a technologist, I believe that technology is the answer for this problem, and that\u2019s why I\u2019m working to bring solutions that promote efficiency and automate the reverse logistics process.<\/p>\n The real challenge is getting people to understand the technology offering and how to use the technology itself. Education on how to physically leverage the technology is key, albeit challenging. The learning curve for some is slow — this is especially true in reverse logistics,\u00a0where fax machines, landlines and physical spreadsheets rule. I\u2019ve walked out of many meetings where conference tables are littered with handwritten notes wondering, \u201cHow am I going to get that guy online?\u201d<\/p>\n The good news is that technology is slowly chipping away at this age-old industry, with both solution providers and retailers embracing and applying it to their reverse-logistics programs. For example, there are SaaS inventory management solutions that, based on data, determine the best channel for an item once it returns to the warehouse (refurbish, reroute, liquidate, scrap). This automated process allows retailers to quickly process and track merchandise, boosting efficiency and helping to keep items out of landfills. Apps that specialize in helping retailers manage online returns are also hitting the market.\u00a0Returnly\u00a0<\/a>is an app that facilitates the return of a product and provides an instant refund to the consumer. Another app,\u00a0Shyp<\/a>, allows the customer to compare shipping options and choose the easiest way to return their purchase.<\/p>\n\n
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