Contents

• This document reviews the paper – “The relocation of a hybrid manufacturing/distribution facility from supply chain perspectives: a case study”
• Min, Hokey and Melachrinoudis, Emanuel 1999, Omega International Journal of Management Science, vol. 27.

Description

The importance of reverse logistics can be realized in many dimensions. It is fast becoming a preferred business practice among various organizations in order to achieve competitive advantages. Defining the term ‘reverse logistics’ in simple words indicates that the process involves flow of goods in the opposite direction to the traditional flow of the supply chain, that is, from producer to consumer, back to a point of recovery or disposal. Its most significant concern is recovery, which can be described as reselling a product, or a series of processes leading to re-manufacturing or recycling. Reverse logistic system is an integral part of Product Recovery Management (PRM), an emerging management field that includes management of “…all used and discarded products, components and materials for which a manufacturing company is legally, contractually, or otherwise responsible”, quotes Krikke et al in their paper. Recovery and disposal are the notable options in a recovery strategy.
With the adoption of reverse logistic systems becoming a common practice among organizations, the design of a reverse logistic network is an important requirement for supply chains. Large-scale companies are now concerned with the optimization of the location and the capacity of their facilities, and good product flows. Krikke et al summarizes the paper with the following issues,
 A brief introduction of reverse logistic system and current issues in recovery strategies
 In-depth literature review on the use of location-allocation models in reverse logistics
 Development of a reverse logistic network design for manufacturing industry, with special reference to copier manufacturing case study
Krikke et al argue that the reverse logistic network design can be considered relevant in organizations as it has the following advantages,
 Choice of optimization criteria including cost minimization
 Process installation in one location results in further cost minimization
 Improved internal logistics due to strong interactions between forward and reverse processes