Greve-Davis recently attended the Reverse Logistics Association trade show in Las Vegas. It was great to see many of our old friends and we had a number of very productive meetings. For many, who have known us for while, the question was “Where have you guys been?” In short, we had a long term project that took up all of 2012, but WE ARE BACK!
While certain aspects of our long term project are confidential, Greve-Davis has emerged as a much stronger team with a lot more to offer to retailers, OEMs, liquidators, auction companies and third party service providers. For 14 months, we worked with leading liquidators and auction companies on a project that allowed us to experience first hand, how these business run day to day. We had access to over 30 companies and saw first hand what works, how some make a lot of money and why some of these companies barely survive.
We now have an extensive amount of experience that will add significant value to liquidators, auction companies, and repair companies that can help them:
- Improve profitability
- Develop new sources of product to liquidate or auction
- Grow your buyer base
- Develop on-line liquidation and auction capabilities
- Reduce expenses
- Increase margins
As a result, we now have a growing client base of liquidators, repair service companies, and auction companies. We leverage our experience to help companies in this sector identify key strategies, processes, and opportunities that enable them to realize dramatic improvements growth and profitability. If you would like to learn more about how Greve-Davis can help your company achieve dramatic results, contact Greve-Davis today.
In this final installment of our four part series on components of a state of the art reverse logistics system (RMS), we will discuss critical reports and visibility requirements. The prior three parts of this series have described capabilities an RMS must have to receive, process, verify, and ship assets that flow through a company’s reverse logistics pipeline.
Before we go too much farther, it should be pointed out that there are two basic infrastructures used to process returns. One we will call the “Direct” model and the other we will refer to as the “Centralized” model. The Direct model is simply processing returns directly from the field to it’s final destination. This is a decentralized design that relies on people in the field or store to prepare and ship goods. A good example are small, mall based retailers that take back returns and sends the goods directly to the vendor or OEM. The second infrastructure is the Centralized model. This model revolves around a central location where all returned goods are shipped to from the field. Goods are then received, prepped, consolidated by final destination/disposition, and shipped. The vast majority of large retail chains use a centralized model to process returns.
Whether an organization should use the Direct model or the Centralized model depends on a number of factors. These include:
- Volume of returns
- Disposition of returned assets
- Residual value of returns
- Number of field or store locations
- Amount of labor required to process returns in the field vs centralized processing costs
- Risk from processing errors
- Regulatory risks
- Existing field systems
- Cost of centralized facilities
- Transportation costs
- Corporate infrastructure
Whether a company has a centralized model that relies on an RMS for processing and visibility or if they use a direct model that relies on a point of sale system or some other back office application to process returns, the visibility requirements are the same. The following is list of reports or visibility requirements broken down by functions:
- Advanced shipment notification – receipts in transit by date, store/field/customer, carrier
- Receipts by store/field location/customer - by receiving, RMA, month, quarter, year
- Returns by SKU/Category/OEM – by RMA, month, quarter, year
- All reports will need to show quantity and value per unit and in total
- Total units processed – by day, week, month, quarter, year
- Units received and processed by disposition – Return to OEM, liquidated, repaired, restocked, donated, recycled, destroyed – by day, week, month, quarter, year
- Manpower reports showing hours worked within each function
- Thru Put – In returns facilities thru put is typically calculated as follows:
Total Units Received / Total Variable Hours
- Shipments waiting for return authorization – by date, value, quantity
- Pick tickets outstanding
- Hazardous material manifests ready for shipment – by class
- Manifests – by date, OEM, liquidator, recycler, charity
- Inbound receipt verification
- Cycle inventory
- Physical inventory – in total, by OEM, category, dollar, units
- Process verification – by function, employee, month, quarter, year
- Location verification – by type of location: bulk, rack, flow rack, shelf, security, etc, day, week, month, quarter year
- Outbound verification – by OEM, liquidator, hazardous shipments, recalled/regulated shipments, random manifest
When it comes to visibility there are endless variations for each type of report listed above. The first RMS put in Walmart’s returns center in 1988 had a total of 26 reports. Today, the average RMS has over 100 reports out of the box and many now incorporate an easy to use report writer.
Best in class reverse logistics systems today offer all reports via the net and can be accessed from anywhere in the world. As with all reporting, however, executives responsible for RMS report development should be careful not to get too caught up in developing new reports or constant reformatting of existing reports. Visibility is only valuable when decisions are being made that impact the business in a positive manner.
Over the next five years, every company will have to rethink their existing reverse logistics network, infrastructure, and systems. As the cost of transportation continues to escalate, the cost of processing will drive dramatic changes in disposition. The decisions around these changes must rely on quality data that comes from an organization’s reverse logistics system. This system will be your only source for the accurate data needed to revise existing returns networks and will be critical in maximizing the value of returned assets and minimizing associated risks in the future.
In today’s podcast Curtis Greve interviews Larry Maye, the COO of Precision Camera. Precision Camera is the world’s largest camera and video repair service provider, with facilities in the US and Mexico.
They provide a range of optical and imaging repair programs to manufacturers, retailers, liquidators and consumers. They are authorized by more OEM’s than any other optical and imaging repair service provider and have over 500 certified techs. For over 60 years Precision Camera has been the leader in camera and video repair.