Abstract

BADENHORST, A  and  VAN ZYL, C. Finding theoretical evidence to justify the outsourcing of reverse logistics. JCMAN [online]. 2015, vol.12, n.1, pp.144-163. ISSN 1815-7440.

Reverse logistics costs add seven to ten per cent of the total cost of goods sold and it is three times more expensive to process the return logistics costs than forward logistics costs. In recent years, with increasing environmental awareness and cost pressure, businesses and supply chains are becoming more aware of the importance of reverse logistics. An in-depth study of reverse logistics has revealed that reverse logistics is a complex process with numerous problems and challenges. Many organisations are not prepared to do or do not have the necessary knowledge to deal with reverse logistics. As a continuation of the in-depth study and by means of a literature study this article explores the possibility of outsourcing of the reverse logistics process to third party logistics providers to alleviate the problem of managing the function internally. It can be concluded that outsourcing to third-party reverse logistics providers is indeed a means in which organisations and supply chains can overcome numerous problems and challenges in reverse logistics. The findings of this study are presented in a conceptual framework that may serve as a guide for further empirical studies and managers who are considering the outsource decision for the reverse logistics function.

Keywords : outsourcing; product returns; reverse logistics; third-party reverse logistics providers.

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