Importance Of Reverse Logistics

3. Many companies are nowadays relying on JIT. They have been able to reduce their inventory but it has increased number of vehicles on the road which add to pollution and congestion.

4. With advent of e-commerce there is increased in transportation which puts burden on environment.

McKinnon (2010) stated that logistics contributes to 5.5% of global greenhouse emissions.

In blanket term ‘Green Logistics’ means logistics that takes into account environmental factor. Yet it can be classified as reverse logistics also. Figure shows differences and commonalties among reverse logistics and green logistics.

Reverse logistics contains Product returns, Marketing returns, Recycling, Remanufacturing, Reusable packaging. On the other hand Green logistics

Green logistics also plays an important role, which adds environment factor into reverse logistics strategies which traditionally have following aspects: product return, recycling, waste disposal, refurbishing, repair and remanufacturing.

Nowadays products have high technology content, difficult manufacturing processes, and costly setup. It is necessary for them to adopt reverse logistics. Implementation of reverse logistics not only helps to improve enterprise logistics service levels, enhance operational efficiency but also reduces production costs. From social point of view, reverse logistics can help reduce adverse impact on environment effectively and increase resource utilization, while also promoting development of green logistics.

It would improve customer’s experience as customers can easily return the product and company can take swift appropriate action. Use of refurbished parts and recycling of materials would enable customers to enjoy the benefits that are gained in costs. Prime raw materials for automobile makers are steel, pig iron, rubber, plastic, non-ferrous materials and other resources. Throwing away cars will create huge pollution whereas these materials can be recycled or

Automobile industry is a large consumer of energy intensive industries like steel, energy and other raw materials. Reverse logistics can create new source of profit through reduction in waste and recycle.

4.2 Existing problems of reverse logistics in Automotive industry

Many companies feel that reverse logistics management faces many uncertainties; common problem is lack of green idea. By Green idea we mean a whole product life cycle focusing on products’ impact on natural resources and environment; adding recyclability and reusability in product design to meet environmental considerations and others aspects like service life and quality (Dekkar, 2012).

Common problem which many of the companies face is profit is not reflected in short term, causing lack of interest among the auto makers. Reason for lack of interest also lies in lack