Give me back my empties or else! A preliminary analysis of customer compliance in reverse logistics practices (UK)

Abstract

This research aims to conduct an exploratory analysis into current industrial reverse logistics practice in business-to-business (B2B) and business-to-customer relationships (B2C), and determine the financial and operational impact of customer non-compliance in returning distribution equipment back to their source.

The analysis was conducted over multiple industry sectors using qualitative research techniques. The research sample included seven industry sectors, providing a response rate of 72 per cent (53 sources approached). The focus was on both B2B and B2C relationships to determine similarities and differences in financial and operational repercussions.

The research findings indicate that the efficacy of the reverse logistics system can be undermined by lack of customer compliance, with losses of up to £140 million (B2B).

In both B2B and B2C relationships, there is evidence of suppliers suffering financial loss due to customer non-compliance. Due to the small scale of the analysis and the breadth of the industry sectors investigated, these results are not generalisable, but do indicate that this is an area, which could undermine supply chain effectiveness. Practical implications – Non-compliance of this nature carries a direct and highly applicable cost for manufacturers and distributors in the practitioner arena. Suppliers within industry need to acknowledge this issue and manage their reverse logistics more effectively.

This paper adopts an innovative focus on an understated feature of the reverse logistics cycle, i.e. the recycling of distribution equipment used to transport outbound and returned products. The paper identifies a range of options, which practitioners can use as guidance when managing the returns system.