PUBLISHER: Allied Market Research | PRODUCT CODE: 1513342
PUBLISHER: Allied Market Research | PRODUCT CODE: 1513342
The global reverse logistics market size was valued at $630.9 billion in 2022, and is projected to reach $947.7 billion by 2032, growing at a CAGR of 4.3% from 2023 to 2032.
Reverse logistics is the process of managing the return of goods from the end user back to the seller or manufacturer. It manages return of goods due to disposal, refurbishment, or replacement of the original product. It typically involves the movement of goods in reverse order from consumer to manufacturer or seller.
Reverse logistics solutions are effective, allowing customers to return products to manufacturers for a variety of reasons, such as wrong product ordered, damaged products delivered, product quality not as per the description, and non-requirement of products at the customer's end. Its services are implemented by pharmaceutical, automotive, FMCG, and other manufacturers to improve customer satisfaction and reduce adverse environmental impact.
The global reverse logistics market growth is driven by expansion of e-commerce industry, increased product recall due to stringent government rules for product quality in the automotive industry, rise of tech-driven reverse logistics services, and surge in adoption of IoT-enabled connected devices. On the contrary, lack of control of manufacturers on reverse logistics service and uncertainty in the reverse logistics process are anticipated to hinder market growth. Furthermore, factors such as introduction of blockchain technology and reduction in losses owing to adoption of a multi-modal system are anticipated to create lucrative growth opportunities.
Technological advancements in FMCG, pharmaceutical, and other industries have revolutionized the reverse logistics market globally. The increase in penetration of Internet of things (IoT) solutions in reverse logistics operations enables direct access to the company network and aids live tracking of shipments for the customers and freight companies. In addition, the evolution of state-of-the-art technologies such as artificial intelligence (AI), machine learning, radio-frequency identification (RFID), and Bluetooth in the reverse logistics industry acts as a catalyst to the growth of the market.
However, the logistics sector involves the movement of goods between the customer and the manufacturer of the product. The reverse logistics industry transfers returned or damaged items back to the manufacturer. The need for reverse logistics is uncertain due to advancements in manufacturing technologies and standards followed by global manufacturers across various industries. In addition, the returned products increase the overall cost of production and result in a negative impact on the reputation of the company.
The procurement sources in reverse logistics vary according to the product and industry, which further complicates the reverse logistics services. For instance, in the e-commerce sector, a product passes through an entire value chain before being delivered to the customer. When a product is returned, sometimes the price of the product is lower than the cost associated with returning the product back to the manufacturer. Hence, market leaders of the retail industry have adopted the practice of letting the customers keep the replacement products to avoid the cost of reverse logistics. Thus, the challenges in predicting the demand for the reverse logistics process are major factors that restrain the growth of the reverse logistics market.
The reverse logistics market is segmented into return type, end user, and region. On the basis of the return type, the market is divided into recalls, commercial returns & B2B returns, repairable returns, end-of-use returns and end-of-life returns. By end user, the market is segregated into e-commerce, automotive, pharmaceutical, consumer electronics, retail, luxury goods, and reusable packaging. By region, the market is analyzed across North America, Europe, Asia-Pacific, Latin America, the Middle East, and Africa.
The key companies profiled in the report include C.H. Robinson Worldwide, Inc., RLG, Core Logistic Private Limited, DB Schenker, Deutsche Post DHL Group, FedEx Corporation, Kintetsu World Express, Inc., Safexpress Pvt. Ltd., United Parcel Service, Inc. and Yusen Logistics Co., Ltd.
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