“Effective handing of returned goods isn’t just good for the business, it’s also very good for the planet,” emphasizes Ryder’s Sensing. “Reverse logistics is intrinsically aligned with environmental sustainability. When companies maximize tons per mile, consolidate shipments, reduce returns and optimize the product disposition and asset recovery processes, they are simultaneously reducing harmful emissions and energy usage, while increasing profitability and asset utilization.”
While this awareness continues to expand in the U.S., companies and regulators in Europe are a few steps ahead, Sensing points out. “In the European Union, the WEEE (Waste Electrical and Electronic Equipment) and RoHS (Restriction of Hazardous Substances) directives restrict the use of hazardous substances in electrical and electronic equipment and provides for their collection, recycling and reuse. Similar laws are under development in the U.S. and other countries. Instead of carting products to landfills, companies are recovering the value of the assets through a variety of other paths, such as returning to stock, donations, secondary market sales and recycling,” he says.
Despite lack of uniform national legislation regarding electronic waste (e-waste) in the U.S., several states have taken it upon themselves to crack down on the disposal of electronics, particularly in landfills. According to GENCO ATC’s Bodenheimer, “California, Colorado and Minnesota are among those with more stringent laws,” although more are following suit.
The problem is only getting worse. In the U.S., three million tons of e-waste, including computers, printers, mobile phones, cameras, TVs and refrigerators, accumulate annually. Worldwide, e-waste is growing by 40 million tons each year. China is the biggest dumping ground followed by India. And while some e-waste that ends up in these and other developing countries is exported there legally (by the U.S. and others), most of it is not. When it’s 10 times cheaper to export e-waste to a developing country rather than abide by safe disposal regulations, it becomes clear as to why the problem continues to grow.
But progress is being made, assures Ryder’s Sensing, “especially by companies that have zero landfill goals and strive to work with a logistics partner that can provide proper recycling and disposal of returned products.” Ryder is working with some of its customers to co-locate forward and reverse logistics operations under one roof. For example, a company can co-locate the distribution management of finished goods with returns processes, such as technical repair, refurbishment, and repackaging in the same facility, which results in greater speed to shelf, visibility and cost savings.
“A co-location strategy further supports carbon footprint reduction and corporate sustainability goals through fewer transportation miles, lower vehicle fuel consumption and lower building carbon output,” explains Sensing, adding that, “A more agile supply chain also decreases product obsolescence and reduces total inventory levels. An effective reverse logistics strategy is actually the ultimate recycling process.”
There’s definitely a social responsibility angle, too. For instance, GENCO ATC works closely with America’s Second Harvest national food bank to donate products that have been returned from grocery shelves. While the food itself has not been compromised and is safe for human consumption, sometimes there are labeling issues that make it unsaleable, Bodenheimer explains.
Inmar also works with its clients to find alternatives to keep food out of the landfills. The company’s remarketing services kept approximately 117 million pounds of grocery and consumer goods out of landfills in 2011. Additionally, Inmar’s donation program provided about 1.8 million boxes of food product that was used to create approximately 5.5 million meals for those in need in 2011.
At the same time, Inmar’s supply chain services, such as packaging studies, have also helped clients reduce product packaging, while helping ensure that new, more environmentally friendly packaging does not increase damage to product and add to the waste stream.