The Relationship between Reverse Logistics And Customer Satisfaction

Chapter 1: Introduction

In today’s highly competitive market, customers have become more sophisticated in terms of their buying practices. To gain customer satisfaction and enhance the product’s life cycle, various companies have realized the importance are incorporating the strategy of reverse logistics to become more prominent and reliable in this competitive market.

The process of reverse logistics includes optimizations of the product or a service after a certain time of release, allowing it to extend its market duration as well as enhancing its overall sustainability in terms of environmental considerations.

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The reverse logistics more often consider the optimization of parameters such as sourcing, disposal, returns, repairs, recycling and/or re-manufacturing, depending on the methodology being adopted by business stakeholders. Nevertheless, the practice is known to ‘recapture the value’ and provides for a ‘sustainable method of disposal for any product/service under the question.

Keeping in mind the growing importance of this approach, the primary aim of this research is to investigate the reverse logistics implications and its impact on customer satisfaction. The following objectives were set for the current study.

The objectives of the study are:

• Understanding the concept of reverse logistics practices in the context of real-time business operations. This includes a review of different theories, practices, models etc. being utilized by the various organizations across the globe and the UK
• Understanding the process involved in returning and recycling used products in reverse logistics. How impactful/successful are these practices? Identify if there is a need for legislative procedures to promote such practices?
• Measuring the relationship between the satisfaction level of customers and the application of reverse logistics in businesses; review through cases studies and business analytical models

In the context of this study, the following research questions have motivated the researcher to undertake this current research. An effort will be made to address these questions.

1. What is the importance of reverse logistics for organizations in a highly competitive market, in terms of profits/savings, environmental considerations, marketing approach etc.?
2. What are the common acquisition processes that organizations adopt for reverse logistics?
3. What is the level of customers satisfaction because of these reverse logistics approaches of modern industries? Is there a need to promote such products/services amongst the users? How does the customer's response to the production of the reverse logistics approach?

Chapter 2: Literature Review

In recent times the science of reverse logistics has gained more importance in terms of institute regulations and profit opportunities. Globalization and advancement in technology have forced organizations to improve their supply chain and increase their reverse logistic processes to compete in the increasing marketing demands (Agrawa, 2014).

Virtually it is crucial for every business and successful organization now to utilize the reverse logistics competencies to satisfy their customers by providing them products exactly as they want, at a more economical price. In addition to the need to maintain their position in a competitive market, the companies are also being encouraged by the customers as well as the society to adopt sustainable methods of production.

Therefore, the company has to clearly understand the functioning and benefits of reverse logistics to enhance the logistics operations as well as its customer-related services.

But what do Reverse Logistic mean?

To understand the concept we have to first gain insight into other related concepts such as supply chain management, logistics and forward logistic. According to CSCMP, the Council of Supply Chain Management Professionals (2010), supply chain management is the planning and controlling all the procedures involved in the distribution and supplying of goods.

This supply chain actually integrated the demand and supply management within organizations and companies to meet the customers need. The term logistics is interchangeably used with supply chain management and involves the administration of material and information between the firms and the suppliers (Hoek et al., 2011).

As discussed previously, the concept of reverse logistics is associated with all the activities related to aftermarket production activities after the products are served for sale. According to Rogers and Tibben-Lembke (2001), this is the reverse movement of goods and raw materials for the purpose of disposal or recollecting products value.

Consumer satisfaction occurs when an organization delivers services more than customers’ expectations. Successful organizations use their logistics especially reverse logistics competencies to become different in the highly competitive market; by extracting most out the supply chain and materials and enhancing the overall efficiency of their life cycles assessments.

The main purpose behind these practises is to keep customers satisfied, develop a successful operation model, reduce costs, enable green manufacturing, and as well as maintaining their loyalty to their company. The importance of reverse logistics in achieving customer’s satisfaction is making this practice common in big as well as small scale enterprises according to the research conducted by Pollock in the year 2007.

Note: The literature to be reviewed In this section will be related to supply chain management, logistics operations and reverse logistics models. Most recent research papers, articles, books and case studies will be reviewed under this section.

Chapter 3: Research Methodology

This research will explore and describe the concept of reverse logistics and its application in a real-life context. Moreover, the research will also intend to explain the acquisition processes involved in reverse logistics. In addition, the relationship between customer’s satisfaction level and reverse logistics will also be measured. Keeping in view the research objectives a mixed methodology comprising of exploratory, descriptive and analytical research will be used (Marouf et al., 2015).

Both primary, as well as secondary research techniques, will be utilized in this study. This methodology/approach will help the researcher to analyse and describe the application of reverse logistics on people through obtaining pivotal information from the literature reviewed in secondary research, and interviews, observations and the level of customer satisfaction will be measured through questionnaires in the primary research.

Data Collection Methods

Secondary Research: Literature Review

As discussed previously, the most fundamental concepts, theories, models as well as perceptions will be obtained through an extensive literature review of various resources including the case studies completed, primarily in the last 5 years.

Primary Research: Survey / Questionnaire

A questionnaire will be developed to gain data on the reverse logistics mechanism and its impact on people. In addition how reverse logistics practices are responsible for achieving customer satisfaction will also be collected in the questionnaire, which will be distributed amongst the key stakeholders of the consumer industry as well as the users/customers.

Semi-structured Interviews

The researcher will conduct semi-structured interviews with the industrialists to get knowledge on the importance of the application of reverse logistics and the acquisition processes.

Customer Satisfaction Questionnaire will be used to collect data from the focus group that will be the customers.

Sampling Procedure

The sample of the current study will be the focus group which will include a few industrialists and street customers. The Snowball sampling method will be used to select samples for the study.

Chapter 4: Research Findings and Interpretation

This section will present the research findings after the analysis of data. The data will be analyzed through statistical tools for example SPSS or excel. The findings will provide the researcher with the knowledge that how reverse logistics is having an impact on modern industrial trends and how it is being used to attain satisfaction levels in customers.

Chapter 5: Conclusion

This chapter will include the conclusion and recommendations in order to answer the research questions in view of the analyzed data.  Further, this part will also include future implications and limitations of this study.

References

1. Agrawal, A., 2014. Reverse Logistics: Performance Measures and their effect on products. International Journal of Core Engineering and Metal, 1(2), p.14.
2. Bernon et al. (2011), Retail reverse logistics: a call and grounding framework for research, International Journal of Physical Distribution and Logistics Management, 41(5), pp 484-510
3. Fleischmann, M., Bloemhof-Ruwaard, J., Dekker, R., van der Lann, E., van Nunen J.A.E.E. and van Wassenhove, L.N. (1997), ‘Quantitative models for reverse logistics: a review’, European Journal of Operational Research, 103(1) pp. 1-17.
4. Hoek, V., J, G. & Harrison, 2011. 'Embedding "insights from industry" in supply chain programmes: The role of guest lectures'. Supply Chain Management: An International Journal, 16(2), pp.142-47.
5. Marouf, M.A., Barky, E. & Sobhy, S., 2015. Impact of Reverse Logistics Applications on Customer Satisfaction. Florida: International Counsel of Service Engineering.
6. Moliner, M.A., Sanchez, J., Rodn'guez, R. M., &Callarisa, L. (2007). Perceived relationship qualify and post-purchase perceived value: An integrative framework. European Journal of Marketing, 41, No. 11/12, pp. 1392-1422
7. Pollock, W.K., 2007. Using Reverse Logistics to Enhance Customer Service and Competitive Performance. Strategies For Growth, 17 December. pp.2-3.
8. Ramanathan, R. (2011), ‘An empirical analysis on the influence of risk on relationships between the handling of product returns and customer loyalty in E-commerce’ International Journal of Production Economics, (130) 255-261
9. Rogers, D. S. and Tibben-Lembke, R. S. (2001), ‘An overview of reverse logistics practices, Journal of Business Logistics, 22(1).