The worldwide growth of e commerce businesses, as well as the growing volume of product returns and replacements has led to a demand for reverse logistics. Reverse Logistics Market growth is expected to be driven by increased product recalls, due to government regulations and stringent quality standards. With the expansion of e-commerce businesses worldwide, a competent inbound logistics solution is needed. As the e-commerce industry grows rapidly, the need to return goods increases in a simpler direction. With some customers asking to physically check the ordered product before deciding whether to keep it, e-commerce service providers emphasize reverse logistics. If the product is not worth buying, customers can return it by means of reverse logistics. Due to the global growth of e-commerce businesses, the frequency of returns and replacement of items that require reverse logistics is increasing. Customers who shop on the internet are more likely to return products because it’s easy to add them to a virtual shopping cart and only through physical inspection can you verify their appearance or fit.
E-commerce businesses have been able to achieve efficiency and accessibility through the increasing use of modern technologies, e.g. automation, robotics or augmented reality. Due to advantages such as convenience, waiting time, cost and wide selection, more and more consumers are used to shopping on the internet instead of shopping in stores. To get products from retailers or manufacturers to end users in a short time, e-commerce businesses rely heavily on shipping and warehousing capabilities.
Automated systems can route customer refund requests, produce packaging and labelling materials, shorten return wait times at retail stores, or allow customers to receive mail orders among others. Once a return request has been submitted or when the return process is complete and all operations are checked for effectiveness, businesses can use automated processes to contact consumers. To ensure that customers continue to be notified as soon as they request a refund, exchange or warranty claim, automation can give them transparency in the return process. It will also help fight fraud during the refund process.
IMPACT OF THE RUSSIA UKRAINE WAR
Since the beginning of the war, the cost of reverse logistics has risen by 30%. This can be explained by several factors, including higher transport costs, increased insurance premiums and the need to use more expensive routes. There was a fall in the availability of reverse logistics services . In fact, many enterprises in Russia and Ukraine have ceased operations or are facing problems such as a lack of skilled staff which has led to supply chain disruptions The demand for back logistics services has increased. Indeed, companies are returning more products as they search for alternative means of recycling and reutilising materials to reduce their ecological impacts because of the disruption caused by the war Furthermore, the cost of transporting goods back to China from Europe has increased by 50%. The reason is that, as a result of the closure of airspace for Russia and Ukraine, shippers have been forced to take longer or more expensive routes. There’s been a 25% increase in the cost of plastic recycling in Ukraine. As a result of this, there has been a shortage of materials and an increased transport and labor costs. For the automotive sector, there has been an increase of 15% in demand for reversal logistics services. This is because there are not enough new vehicles, and the parts needed to repair them have to be recycled.
In the near term, it is anticipated that the impact of the Russia Ukraine war on the recirculating logistics market will be maintained. Businesses will need to plan for higher costs, reduced capacity and increased demand if they rely on reverse logistics.
IMPACT OF ON GOING RECESSION
From 2023 onwards, the cost of reversing transport is expected to grow by 15 %. There are a number of reasons for this, which include increased transport costs, higher labour costs and the need to comply with new legislation. about environment. It is expected that there will be a reduction in the availability of reverse logistics services This is due to the decrease of business costs and staff levels which has resulted in a lesser number of relocatable service providers. It is expected that demand for the alternative logistics services will continue to grow. Companies of all sizes have returned more goods as consumers reduce their expenditure, and they are also finding a way to reuse or recycle materials in order to decrease their environmental impact The cost of return from the United States to China increased by 10%. This is due to an increase in fuel prices as well as a decrease in the availability of containers. The costs of electronics recycling have increased by 5% in the United States. This can be attributed to reduced demand for electronic equipment, as well as an increase of labour and transport costs. The 15 % increase was due to increased demand for rerouting logistics services on the market. This can be attributed in part to an increase in internet shopping and a higher share of fresh goods that have been returned due to the downturn.
Asia Pacific has the largest market share and continues to be dominant. The region is anticipated to retain its dominant position over the forecast period, in view of strong demand for young fashion clothing. The rapid rise of the e-commerce industry, as well as the rapid growth of online shopping in countries such as India and China, have also contributed to this growth. The growing trend of online shopping will bring higher profits which is likely to support market growth in the region. Furthermore, the market expansion is expected to be driven by the growing growth of the manufacturing sector in developing countries and the growing demand for reverse logistics for electric vehicles. During the forecast period, the Middle East and Africa are expected to witness significant growth. In the Middle East and Africa, reverse logistics is expected to grow at the second fastest annual growth rate during the forecast period. Several strategic initiatives are taken by top players to improve their competitiveness. Furthermore, the Middle East is undergoing increasing investments to become a logistics hub. These factors and the rise in disposable income provide a favorable outlook for the region’s reverse logistics industry.
Some of the key players in the reverse logistics market are Safeexpress Pvt Ltd, DB SCHENKER, FedEx Corporation, Yusen Logistics Co. Ltd, Deutsche Post AG, RLG Systems AG, Kintetsu World Express, Inc, Core Logistic Private Limited, United Parcel Service , Inc. , CCR Logistics Systems AG.
RECENT DEVELOPMENT
DB Schenker is launching a range of new circular economy logistics products.
Two new Express services have been announced by AJEX Logistics Services, a specialist in fast shipping and distribution solutions to the Middle East based in Saudi Arabia: AJEX Same day domestic and AJEX pickup in Dammam, Riyadh and Jeddah.