In the early nineties, the first definition of RL
emerges. Stock (1992) emphasised the recovery
aspects of RL, defining as: "... the term often used to
refer to the role of logistics in recycling, waste
disposal, and management of hazardous materials; a
broader perspective that includes all logistics
activities such as recycling, substitution, reuse of
materials and disposal of products”. Furthermore,
Rogers and Tibben-Lembke (1998) summarize RL as
the process of moving goods from the final
destination to another point in the supply chain, in
order to capture unavailable value. More recently,
Pokharel and Muha (2009) stated that the focus of RL
refers to the waste management, recycling of
materials, recovery of components or product
recovery. According to the authors RL involves a
paradigm shift in terms of product life-cycle.
Traditionally the life cycle of a product was between
the period of its manufacture and its disposal ("cradle-
to-grave"). Currently RL allows a change of the
product life cycle, from the period of manufacture to
its recovery ("cradle-to-cradle").
Companies have been using more liberal return
policies in order to reduce the risk of the final
customers and thus increase sales volume (Smith,
2005). In the United States, the estimates are even
more significant with the annual costs about $ 100
billion for the manufacturers and retailers
corresponding to a reduction in the yield at about
3.8% (Blanchard, 2007), while Greve and Davis
(2012) state that the electronics industry is over 14
billion dollars, as well as the rates of returns of the
end customers ranging from 5% to 9% of sales for
most retailers.
Implementing an effective system generate
multiple benefits for businesses, including increased
customer satisfaction level, reducing the level of
investment in resources, and reduce storage and
distribution costs (Andel, 1997). Thus, the integration
of RL in supply chains is increasingly used as a
strategy to increase profits or to promote
sustainability and customer satisfaction (Du and
Evans, 2008). That said, Brito and Dekker (2003)
identify the main reasons that lead companies to
adopt RL operations:
Economics – RL programs can bring direct
gains through lesser use of raw materials,
reduction in disposal cost, etc. Companies also
have indirect gains due to competition,
environmental image, improve customer-
supplier relations, etc;
Legislation - refers to any jurisdiction that
indicates that a company should recover all the
products produced by them or own
responsibility for end-of-life products. With the
growing concern for the environment, laws
have been emerging in European, that forced
companies to develop their RL processes with
the introduction of quotas for the recovery,
recycling and packaging;
Corporate citizenship - concerns a set of values
and principles that motivate an organization to
become involved responsibly in RL activities.
This motivation arises from the need to hold a
responsible and conscientious stand towards
environmental issues.
The activities of a RL network in supply chains
may differ, such as, type of products returned, the
desired recovery and the logistics network
implemented. We can essentially identify 5 groups of
recurrent activities in various supply chains with RL
(Prahinski and Kocabasoglu 2006; Barker and
Zabinsky 2008; Silva et al. 2013). These groups are:
acquisition of products, collection of products,
inspection and disposal, recovery and distribution and
resale.
Ravi and Shankar (2005) studied the main barriers
to the implementation of RL operations in the
automotive industry. They concluded that there are
five main barriers, lack of knowledge of RL, lack of
commitment by managers, problems with product
quality, lack of strategic planning and financial
constraints. However, the lack of knowledge
regarding RL practices is the most significant barrier.
Therefore, managers should focus on the
development of their awareness on the use of RL.
Aberdeen Group (2006) conducted a study on RL
based on a survey of 175 companies from various
continents. The aim of this study was to analyze the
best management practices on RL. From the
companies surveyed, 61% mentioned that effective
management of RL is very important. The authors
also found that companies spend about 9% of sales in
costs related with RL.
According to a study by Chan and Chan (2008),
successful RL systems may result in greater customer
loyalty and reduced operating costs due to the reuse
or replacement of products. Their study consisted of
a total of 73 companies of the mobile industry in
Hong Kong and 34 interviews. This research showed
that companies in this sector consider RL important,
but compared to other issues RL importance is
smaller and this is the biggest barrier to the
implementation of RL.
Finally, Ravi and Shankar (2015) developed a
study, based on a survey of 105 companies in India,
where they investigated RL practices in four sectors
of the Indian industry: automotive, paper, food and