The Importance of Reverse Logistics in the
Apparel Industry
Explain and describe why the apparel industry needs a reverse logistics program in their operational
plans.
REVERSE LOGISTICS 2
The Importance of Reverse Logistics in the
Apparel Industry
In Stă nciulescu (2011), the relevance of Reverse logistics (the process of return a
product to its point of origin once purchased) in the Apparel industry can be a factor that sets
a company above its competition in a number of ways. First and foremost an effective reverse
system lowers overall costs associated with the reverse process therefore providing the
company with a cost-benefit against its competitors. This in turn sustains a minimizing cost
approach. Through quick restoration and sending back of products to the consumer faster,
customer service is enhanced thus separating the firm from its competition. On top of that,
the retrieval of parts or reprocessing of components involved in the return process adds to
value creation. When reverse logistics is used as a strategy to increase the profit margin, it
typically is meant to have an effect on a long-term basis in terms of sustainability. Research
has shown as stated in Stă nciulescu et al. (2011), that a quarter of a particular company’s
profit can be drawn from developments in its reverse logistics process.
Management of the return process is vital and fundamental in the clothing industry as
shopping online keeps on increasing at a fast speed consequently leading to a rise in the
amount of returned goods as explained in Hothem (2015). A research conducted showed that
during the holiday season two-fifths of apparel purchases from a number of companies were
returned. The majority of imported goods making through to the local market have also
intensified bringing with it numerous difficulties. Struggle for viability among companies has
become denser due to the growth of e-commerce. This poses a great risk for organizations as
their aim in the supply process is meant to make efficiencies that curbs these difficulties.
REVERSE LOGISTICS 3
For a product such a piece of clothing to be returned, there may be a number of
factors that leading to that as explained in Hothem et al. (2015). This comprises of incorrect
counting of the number of products to be delivered, holdups, flawed paperwork and
mismanagement of the product in the storage facility, vehicle of transportation or at the
endpoint. Additionally, packing the good inappropriately or marred or undesired products are
some reasons that lead to the return of a purchase.
In the clothing industry, various methods can be utilized to make more efficient the
process of reverse logistics and mitigate the chances of factors leading to a returned product
from occurring if not avoiding it altogether. The following two ways as listed in Hothem et
al. (2015) improve the return process.
Salvaging profits. Sales are made when a good is shipped and lost when the good is
returned back. Consequently, the proficiency to put back returned products into the retail
process to produce income and regulating the number of returns offsets costs involved by a
considerable percentage. The productivity of the goods returns is tackled by repackaging,
reviving and putting back into inventory. As a result, sales are heightened and costs
decreased.
Study. A research needs to be carried out to determine at what points which wrong
decisions were made. This will help establish the main reason for return and add to the
consequent changes. The uncertainties that need to be answered are whether the product is
being shipped more than it should, is it being shipped at the unsuitable time, is the
presentation of the good improper and if supply is significantly higher than the demand.
This helps improves the shipping process and more focus is put on reverse logistics hence
avoiding costs and adding to a company’s profits.
REVERSE LOGISTICS 4
References
S. Hothem (2015). Reverse Logistics for Clothing: Finding Cost Saving opportunities.
The U.S. Textile and Apparel Industry in theAge of GlobalizationKathleen Rees and Jan HathcoteG. C. Stă nciulescu (2011). Importance of Reverse Logistics for Retail Acts, Supply ChainManagement – New Perspectives, Prof. Sanda Renko (Ed.), ISBN: 978-953-307-633-
1, InTech,
