Reverse Logistics in Brewing Industries

 Reverse logistics is defined as “the process of planning, developing, and efficiently controlling
the flow of materials, products, and information from the place of origin to the place of
consumption in such a way that while satisfying the consumer’s needs, the available remaining
material is managed to be reintroduced into the supply chain, obtaining an added value and/or
if not possible procuring a suitable disposal of this remaining material”.

Pilot Study

1. Delimitation: Focusing on particular city.

2. Collection and Routing:

The substitution of recycled glass instead of virgin materials enables bottle manufacturers to operate at
lower furnace temperatures and improve emission characteristics e.g. nine gallons of fuel oil are saved
for each ton of glass that is made from recycled cullet instead of virgin materials [10]. Recycling one ton
of glass into new bottles and jars saves 315 kg of tons of CO2 compared to using raw materials taking
into account all the raw material extraction, processing, and transport energy used

Development of the reverse logistics network configuration includes the classification of the point of
sales according to the probability that consumers take back non-returnable packages. In this sense, e.g.
bars and restaurants where consumers drink the product in-site will have a higher recovery rate than
supermarkets.

From a social point of view, currently “waste pickers” make their income by sorting the waste at the
dumpsite and selling the material to recycling companies. It is necessary to offer an alternative to
relocate these people to other jobs, for example, some of them could work at the recovery center

Difference between Forward and reverse Logistics

 A reverse logistics flow has much less visibility and therefore is more difficult to react than in
forward logistics.
 Companies initiate forward logistics activity as a result of planning and decision making, while
they consider reverse logistics a response to actions by consumers or downstream channel
members and not a part of their decision system.
 The most prominent difference between forward and reverse logistics is this of product flow. In
forward logistics the products flow from the manufacturer towards the consumer, while in reverse
logistics the flow is from the end user to the manufacturer.
 In both flows, there might be inventory storage Reverse logistics deal with defective units and
other problematic products that follow random routing, while forward logistics deal with finished
products that are sent to customer to fix dated and after they have been ordered.
  In reverse logistics at the time of the return, information about the item and its condition may be
entered into the manufacturer or retailer system and forwarder to the returns-processing center
(information flow). Unfortunately, this information capture rarely occurs, or is inaccurate. On the
contrary, the information flow in forward logistics is of great importance and considered the key
for effective management.
 Regarding technology and information systems that involved in reverse logistics, in most cases
they are the same with these of forward logistics. There is a gap in IT technologies that cover the
needs of Reverse Logistics. An example is the standard enterprise resource planning systems
(ERP) that are used by most companies for their forward logistics and are not effective to support
the functional capabilities of reverse logistics.
 Finally, cash flow in reverse logistics are in terms of credits or discount. Customers that return
the product because it is damaged expect to receive a refund or a new product if there is a
warranty. In forward logistics the customers buy goods with cash or credit cards.

Glass. A Coors partner, Rocky Mountain Bottle Company, purchases 79,000 tons of used glass, or cullet,
a year. The recycled content of the bottles produced at that company's plant is approximately 30
percent. Recycling glass conserves energy, keeps material out of the landfill, and saves resources. For
example, 100 tons of cullet will yield 100 tons of bottles. However, if only virgin materials are used,
there is a 15 percent fusion loss. A separate strategy of reducing weights of certain-sized bottles has
yielded an annual savings of 72 million pounds of glass

In analyzing your company’s reverse logistics system performance,

consider tracking these metrics:

 Disposition cycle time: Cycle times can be an important measure

of reverse logistics. The more standardized and streamlined the
processes are, the shorter the cycle time should be.
 Amount of product reclaimed and resold: What percentage of
product that moves to the reverse statistics system is reclaimed
and resold? How much value is recaptured?
 Percentage of material recycled: This metric tracks the
percentage of product in the reverse logistics stream that is
recycled in an appropriate manner.
 Waste: How much product and other materials are moved to
landfills, incinerated, or disposed of as waste? The objective is to
minimize product in the waste streams.
 Percentage of cost recovered: Is the firm maximizing the
profitability of product that did not sell well or has been returned by
consumers?
 Per item handling cost: A cost-per-touch type of metric can be
readily computed by dividing total facility costs per month by the
number of items processed. This is also a valuable way to compare
the efficiencies of different facilities.
 Distance traveled: Tracking average distance traveled per item is
not nearly as simple as determining per-item-handling cost.
Generally speaking, the fewer miles that can be put on an item in
the reverse logistics network, the better.
 Energy used in handling returns: This metric is used in
sustainability programs. It measure how much energy (diesel fuel,
electricity, etc.) is used in the reverse logistics process.
 Total Cost of Ownership: What is the total cost of ownership
related to originally acquiring the product, reselling it, bringing it
back as a return, and moving it through a secondary market or
placing it in a landfill?