Retail returns: Turning costs into profit at a UK 3PL
Abstract
Returns can be a costly process compared to forward logistics due to the increased complexity of handling returned items that arrive at a returns centre in a random order in batch sizes of one. In order to recover value from returned items, it is necessary to undertake additional activities, from inspections through to preparation for re-sale. This case study looks at a UK-based 3PL and the value-adding activities that it has implemented to improve the efficiency and minimise costs of managing returns with four of its clients. Over an 18-month period the authors worked with Prolog Fulfilment Ltd to identify financial efficiencies, sustainability improvements and general changes to working practices. A reverse logistics toolkit was applied across the four clients to help determine new and innovative ways of processing returns. The paper applies a returned items classification continuum to demonstrate how improving processes can move products up the continuum and hence recover more value. The case study illustrates how returns management services can both add value for retailers and improve the reusability and recyclability of returned products and their component parts, thus reducing the amount of product going to landfill.
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Author's Biography
Jonathan Gorst is deputy head of the Department of Management, Sheffield Business School, Sheffield Hallam University, where he lectures in the areas of supply chain management, logistics and quality management. Jonathan’s personal research is in the area of reverse logistics. He has been researching this area for the last 15 years and in recent years this has been focused on retail returns and the implications of omnichannel shopping. His current work focuses on a reverse logistics tool kit that has been developed to aid companies assess their current reverse logistics processes and target where they can make improvements. Jonathan is part of the Reverse Logistics Research Group, which brings together colleagues from the universities of Sheffield, Sheffield Hallam and Cranfield to develop and carry out further research in the area of reverse logistics. Jonathan is also an active member of the Chartered Institute of Logistics and Transport’s (CILT) Retail Logistics Forum.
Erica Ballantyne has a PhD from the Institute for Transport Studies at the University of Leeds. Her principal areas of research and expertise include reverse logistics and retail returns management, logistics and freight transport operations with an emphasis on urban and last mile contexts, efficient and sustainable transport with electric vehicles and transport application for energy storage, and transport planning and management decision making. She has previously been employed in various operational and management roles within the logistics and transport industry, including working for a major European 3PL, the UK retailer ASDA, and other leading supply chain contractors mainly in the FMCG and grocery markets. Erica is part of the Reverse Logistics Research Group which brings together colleagues from the Universities of Sheffield, Sheffield Hallam and Cranfield to develop and carry out further research in the area of reverse logistics. Erica is also an active member of the Chartered Institute of Logistics and Transport’s (CILT) Logistics Research Network.
Citation
Gorst, Jonathan and Ballantyne, Erica (2021, June 1). Retail returns: Turning costs into profit at a UK 3PL. In the Journal of Supply Chain Management, Logistics and Procurement, Volume 3, Issue 4. https://doi.org/10.69554/KLMM8236.
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