Product Recalls and Reverse Logistics

He also credits the industry for proactively seeking partners such as Inmar to help boost their ability to effectively deal with product recalls. Part of food and beverage companies’ willingness to improve their processes involves training, too.

Inmar provides mock training events for customers, says Pepperworth. “We walk their entire organization through a mock recall event. That way, we can identify gaps in their processes and if they ever have an actual recall event, they’re very prepared.”

The role of technology…

Aside from training and the other tools that reverse logistics providers are using to elevate their customers’ ability to respond to recalls, the most important is technology, emphasizes Pepperworth and Bodenheimer.

“In the retail environment, particularly with the larger retailers, we’re seeing more sophistication in technology, particularly with inventory management,” says Pepperworth. “It’s become more automated. The larger retailers are also equipping themselves with wireless capability and handhelds, for instance, so the ‘transaction’ of an item is happening much more quickly than it was 10 years ago.”

Inmar has made significant investments in technology in recent years. “Over the past four years, we’ve invested $100 million in IT infrastructure alone,” says Pepperworth. “That investment has primarily been around speed and speed of identification.”

“In the food and beverage industry, we can provide great detail and speed around the identity of products (at the UPC level) and what’s going on with them.”

Information is key, says Pepperworth. “The technology that’s being deployed is all about faster and more efficient information. In addition, we can also interpret what that information is telling our customers. The analytics aspect is very important.”

Bodenheimer sees plenty of advantages with technology too, starting with the ability to track and trace product.

“You have to be able to track, whether it’s mandated or a voluntary recall or a withdrawal event. And, you have to have a timely mechanism for performing that tracking function.”

He adds, “The other piece is that many companies are faced with a lack of visibility and insight into their financial exposure if the system they have in place doesn’t have the type of flow that offers timely handling and processing, as well as immediate visibility into what’s been received, what’s been processed, and what’s been dispositioned.”

According to Bodenheimer, “We’ve really built our program on a strong technology platform. Our software, R-Log, is web-enabled and fully customizable. It provides a secure portal and visibility into the data.”

Genco ATC states that R-Log standardizes and streamlines the entire returns process, virtually eliminating human error and significantly reducing paperwork and duplication of effort. Some of the benefits include: return labor hours reduced by as much as 80 percent; warehouse labor hours reduced by 60 percent; and marketing return cycles reduced by 50 percent.

Bodenheimer says that the company’s use of Sky-Trax is another example of how technology is helping transform the entire reverse logistics process.

“It allows us to automatically track assets down to a couple inches of accuracy within a facility. Warehouse equipment, like fork lifts for example, we know where it is at any time. This improves warehouse safety and efficiency tremendously—fewer incidents and lower operating costs, improved inventory accuracy, and greater throughput.”

…and partnerships

Getting closer to the customers and their needs while simultaneously raising the bar for the industry is a key concern for both Genco ATC and Inmar.

“Our value proposition is based on three pillars,” says Bodenheimer. “Avoid, Streamline, and Optimize. Obviously, we start by working with our customers to identify opportunities to avoid returns in the fist place. Secondly, it’s important to streamline the process, starting with our proprietary software, our regional network of facilities, our experience and knowledge with regulatory compliance, and extending through to sustainability programs. The optimized part of the equation comes into play when you have product that still has some useable life in it. The customer may want to maximize the value of it through a remarketing effort or donation if it doesn’t have any commercial value. If it’s damaged, we make sure there’s a compliant disposal process in place, which includes a hazardous waste stream.”