Product categories entering the return process in the value chain are seen as product returns that can be put back on sale, service-based products involving product improvement, repair and maintenance, products with economic value that can be segregated, and waste-value recycling-based products.

One of the goals in return logistics, which is one of the supply chain components focusing on return processes, can be seen as obtaining maximum benefit from returning products. Therefore, reducing return rates and thus lowering costs, while making the actual returns beneficial within the current structure or different solution dynamics, is a distinct task.

The priority of reducing reverse logistics costs, which has been adopted as an approach for many years, has given rise to strategic reverse logistics management that enables process improvements based on customer experience with the evolution of traditional business models into e-commerce channels. The fact that return rates in e-commerce are 3-4 times higher compared to traditional purchases (ref. Reverse Logistics Association), along with increasing customer demands and expectations and unconditional return regulations, brings a serious cost and service pressure for companies.

Although there is essentially no difference in cost components between forward logistics and reverse logistics, except for repackaging and product depreciation (associated with inventory cost), the stages that put the most weight on reverse logistics costs are transportation, sorting, quality control, handling, and repackaging. Table 2

TABLE 2 Reverse Logistics Costs

Cost                                  Relation to Forward Logistics Costs

Transportation                                              Higher

Inventory Carrying Cost                                  Lower

Product shrinkage                                         Much lower

Obsolescence/wear                                      Higher

Collection (transport)                                     Much higher

Sorting/quality control                            Much higher

Handling                                            Much higher

Maintenance/repackaging                               Higher - Not present in Forward Logistics

Product depreciation                                     Higher - Not present in Forward Logistics

Warehouses, which are locations where inventory velocity is 0 in supply chains, are seen as revenue centers where all kinds of handling operations that add economic value to the product can be performed in forward and reverse logistics processes.

Since return warehouses attached to the main warehouses of companies are generally located in economic centers with high consumption and production, storage expenses, especially on a rental basis, place a heavy burden on returned products. In this framework, regional return collection and handling centers can offer a different solution alternative.

Excess transportation costs caused by a lack of scale in return collection and shipment to the main warehouse seen in reverse logistics can reduce transportation costs as they are combined in regional warehouses and set off to main warehouses as full truckloads (FTL). At the same time, the increase in product loss and damage rates during the process of products arriving individually at the main return warehouse through transfers can be prevented by using regional warehouses. In addition, processes such as repair and maintenance for service-based return products can also be performed in these warehouses, and the customer service level can be made sustainable with shipping to the customer in a short time. Scrap and other economically low-level product categories can be stored in low-cost regional return collection centers, and products suitable for standardized business processes can be handled in these warehouses.

While the classic supply chain network structure is developed in accordance with plans based on 5-10 year warehouses, stores, and their affiliates, the market structure made dynamic by e-commerce and increasing customer demands and expectations have made inventories highly fluid. In parallel to this, companies with suitable demand structures have reduced their inventory-location planning to 1-2 year periods within the framework of a dynamic network structure planning, and have also incorporated access to much shorter-term locations and services that can adapt to extraordinary developments and demands into their supply chain policies.

With ParkPalet dynamic warehousing solutions, it is an online warehousing marketplace that can provide different types and scales of warehousing services needed by companies in the short and long term through registered warehouses in its portfolio all over Turkey. In this way, those in need can avoid fixed expense investments caused by long-term leases and team/equipment, etc., and do not experience capacity utilization inefficiencies resulting from demand uncertainties. They can increase their customer service levels with a fast and economical structure.

With ParkPalet dynamic warehousing solutions, you can create a flexible supply chain network structure in your forward and reverse logistics processes, and meet all your warehousing needs in different regions economically, quickly, and at pre-determined standards.