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Returns & Reverse Logistics

Reverse Logistics

The process of moving returned goods back through the supply chain, including inspection, restocking or disposal.

ecommerce-glossary
CategoryReturns & Reverse Logistics
Related terms4
Terms indexed121
StatusDefinition ready

In practice

It's often more complex and costly per unit than forward shipping, since it involves inspection, a decision on whether to restock, refurbish, liquidate, or dispose of the item, and sometimes a completely different transportation route back to a warehouse.

A returned pair of shoes travels back to a distribution center, gets inspected for damage, and is either restocked as new or routed to a liquidation channel depending on its condition.

Why it matters

It's often more expensive per unit than forward shipping, which is why a high return rate can quietly erode margin even on products that sell well in the first place.

Worth knowing

  • Involves inspection, then a decision to restock, refurbish, liquidate, or dispose of the item.
  • Return shipping routes often differ from forward shipping, adding complexity to a logistics network.
  • A well-designed process can recover meaningful value from returns that would otherwise be a pure loss.
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