Third Party Logistics Service Feature: "Advance Returns"
We all hear a lot about "reverse logistics" these days. Many folks are still trying to figure out of this is something new, or just another buzzword. My opinion is that it is really a bit of both. In so many cases it is just a new name on an old face – product returns, asset disposition, disposal; but in some cases it emphasizes a new focus on post-delivery customer satisfaction.
One logistics program that highlights this point is Advance Returns. One of our consulting clients – the logistics division of a major integrated forwarder, has developed a unique third party program with a brand name monitor manufacturer. It works like this:
The monitor manufacturer sells high-end workstation monitors and is in a very competitive business. They need to ensure that if their customers monitors stop functioning, their customer can continue working. They do this through an "advance return" program. When the user calls the manufacturer and says "my monitor's broken" and technical support cannot help them, the manufacturer notifies the logistics company to send a replacement monitor to the client. The logistics company pulls a monitor out of inventory at their hub and sends to the client, picks up and packages the broken monitor and returns it to the repair center. It is later returned to the client, and then the replacement model returned to inventory.
There are several variations of this type of program. The one just mentioned is great from a third party provider's standpoint as there are four transportation transactions!
REPLACEMENT TO CLIENT è BROKEN UNIT TO REPAIR è REPAIRED UNIT TO CLIENT è REPLACEMENT UNIT TO INVENTORY
Federal Express has a program where they actually repair the monitor themselves at their hub in Memphis!
The benefits of these programs to the manufacturer are:
Increased customer satisfaction and competitiveness
Reduce expense by not having local repair centers
Reduce or eliminate on-site visits by Field Technicians
Better tracking and inventory control through the third party logistics company
If you have any comments or questions, please send us an e-mail! Jim Powell, Publisher
Transportation Development Group
Toll Free at: 800-949-4834Telephone 310-302-0808Fax 310-302-0809E-mail: Info@logisticstraining.com
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