The Impact of Reverse Logistics on Operational Performance

Abstract

Logistics management is an integrated part of supply chain management. Reverse logistics is for all operations related to the reuse of products and materials. It is "the process of moving goods from their typical final destination for the purpose of recycling, reuse, capturing value, or proper disposal. Remanufacturing and refurbishing activities also may be included in the definition of reverse logistics." Growing green concerns and advancement of green supply chain management concepts and practices make it all the more relevant. The number of publications on the topic of reverse logistics has increased significantly over the past two decades. This research paper investigates the relationship between reverse logistics operation, environmental performance, and competitive advantage, financial and operational performance of pharmaceutical firms located in India. This research paper has been adopted simultaneous regression method to test hypothesis. The results indicate that all endogenous (operational, environmental and financial performance) except competitive advantage are positively and significantly correlated with reverse logistics operations, while competitive advantages and reverse logistics operations have insignificant relationship. In addition, due to adoption of reverse logistics, firms may increase their overall performance and increase the efficiency of manufacturing processes due to elimination of waste. Furthermore, implementing reverse logistics operations, more opportunities to firms to improve their products’ quality and reduce their end-to-end supply chain cost will take place.