Executive Briefings

As E-Commerce Grows, More Emphasis Needed on Reverse Supply Chain

Over the years, retailers have become very good at the supply chain - the process of getting goods from the manufacturing plant to the customer. But today, many retailers face a different challenge: taking those goods back, a process referred to as the "reverse supply chain."

As E-Commerce Grows, More Emphasis Needed on Reverse Supply Chain

Every year, 2 million tons of retail returns are loaded into landfills, according to Environmental Capital Group, many of which are already brimming to capacity and contributing to environmental problems like groundwater contamination and greenhouse gas emissions.

Many retailers expect the problem and cost of retail returns to grow, thanks to the rise of e-commerce and more retailers offering free shipping and free returns. A recent study from eMarketer forecasted e-commerce sales in the U.S. will grow 15.6 percent in 2016, with e-commerce’s share of total retail sales poised to surpass 10 percent by 2018. Large retailers from Macy’s to Target and Wal-Mart have vowed to grow their omnichannel and e-commerce capabilities, offering new options to customers in order to compete with Amazon. 

As retailers ramp up their offerings to keep up with changing consumer expectations and shopping habits, experts say the industry must place a greater emphasis on the reverse supply chain. With the changing tide, retailers are finding they must be equipped to process returns from multiple channels in an efficient manner: an investment that makes environmental and business sense, albeit one they have not traditionally focused on.

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Every year, 2 million tons of retail returns are loaded into landfills, according to Environmental Capital Group, many of which are already brimming to capacity and contributing to environmental problems like groundwater contamination and greenhouse gas emissions.

Many retailers expect the problem and cost of retail returns to grow, thanks to the rise of e-commerce and more retailers offering free shipping and free returns. A recent study from eMarketer forecasted e-commerce sales in the U.S. will grow 15.6 percent in 2016, with e-commerce’s share of total retail sales poised to surpass 10 percent by 2018. Large retailers from Macy’s to Target and Wal-Mart have vowed to grow their omnichannel and e-commerce capabilities, offering new options to customers in order to compete with Amazon. 

As retailers ramp up their offerings to keep up with changing consumer expectations and shopping habits, experts say the industry must place a greater emphasis on the reverse supply chain. With the changing tide, retailers are finding they must be equipped to process returns from multiple channels in an efficient manner: an investment that makes environmental and business sense, albeit one they have not traditionally focused on.

Read Full Article

As E-Commerce Grows, More Emphasis Needed on Reverse Supply Chain