Remanufacturing is key to growth in supply chain

New APICS survey finds that remanufacturing and reverse logistics are no longer niche competencies

Latest News

State of Logistics 2016: Pursue mutual benefit
ATA reports sharp decrease in Q4 truckload driver turnover rate
Challenges remain in store for shippers, says FTR SCI report
Florida East Coast Railway to be acquired by Grupo Mexico
Cat Lift Trucks awards $5,000 scholarship to high school student
More News

Latest Resource

The View from the New “Single Window”
The single window, officially known as the "International Trade Data System," operates via the Customs and Border Protection (CBP) agency's Automated Commercial Environment (ACE) platform, and serves as a single point of contact for all trade filings.
All Resources
By ·

Most supply chains move in one direction: New products move from manufacturing to a customer. Increasingly, those products are coming back into the supply chain, either as returns for repair under warranty work or to be remanufactured for reuse. In fact, new research from the nonprofit organization APICS Foundation, finds that remanufacturing serves a broad array of strategic interests for companies, provides considerable career advancement potential for individuals and has become instrumental in furthering sustainability initiatives.

“Remanufacturing was once considered a niche process,” says Jonathan Thatcher, director of research, APICS Foundation. “Today it is becoming a mainstream practice.”

The findings are part of the APICS Foundation’s recent report Examining Remanufacturing in Supply Chain and Operations Management. A copy of the report is available for downloading online. Thatcher will also host a webinar on the findings on June 5, at 1:00 p.m. CT. You can access the report and register for the webinar here.

Remanufacturing, defined as the process of restoring used or worn products to like-new condition, is an area of growing opportunity for supply chain and operations management professionals. Previously segmented to specific areas of the B2C supply chain, like customer service, remanufacturing has established a place in both B2C and B2B supply chain models and is expanding significantly as additional markets accept and trust the “as good as new” concept. While many businesses may look at remanufacturing as part of their warranty processes, Thatcher says there are a number of entrepreneurial opportunities around remanufacturing in areas such as electronic devices, printer cartridges and other products.

“Remanufacturing provides obvious benefit for the forward progress of sustainable supply chain initiatives,” adds Sharon Rice, executive director, APICS Foundation. “Supply chain professionals are eager for more information about this quickly evolving area because, as our survey has shown, more than 50 percent of survey respondents felt it was important for supply chain and operations management professionals to have at least some familiarity with remanufacturing as they expect a growing demand for remanufactured goods.”

To gather information for this report, the APICS Foundation surveyed supply chain and operations management practitioners in 2013 in response to a growing interest in remanufacturing and requests for more research.

Three key findings arose through the surveys that further identify the current perception of remanufacturing and distinguish how professionals anticipate its future industry benefit:

• Remanufacturing drives sustainability – Sixty-eight percent of respondents felt that sustainability was the primary advantage associated with remanufacturing, and 41 percent already consider it a formal component of their organization’s sustainability policies.

• Remanufacturing provides vast organizational benefits – While 59 percent of respondents noted the additional complexity remanufacturing brought to reverse supply chains, the process was commended for the additional benefit it brings to an organization: increases customer satisfaction (66 percent), enhances product and organizational value chain (47 percent), and reduces production costs in relation to new manufacturing (46 percent).

• Remanufacturing adds career versatility – Remanufacturing requires new skills in forecasting, planning, and inventory management. With these skills, a supply chain and operations management professional can better identify potential for opportunity and innovation in forward and reverse supply chains.

APICS also found that a number of supporting trends are converging to support remanufacturing, from the opportunity to build brand awareness in emerging markets that need lower-than-new price points to developing a functioning reverse supply chain path as a risk management strategy.

Just as remanufacturing and reverse logistics is becoming a mainstream supply chain function, in the future, it may also become a required competency for supply chain professionals. “This is no longer in the category of emerging competency,” says Rice. “As APICS looks to keep up to date, we believe that in the future, we’ll see remanufacturing in our certifications as a base line competency.”


About the Author

Bob Trebilcock
Bob Trebilcock, editorial director, has covered materials handling, technology, logistics and supply chain topics for nearly 30 years. In addition to Supply Chain Management Review, he is also Executive Editor of Modern Materials Handling. A graduate of Bowling Green State University, Trebilcock lives in Keene, NH. He can be reached at 603-357-0484.

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Article Topics

All Topics
Latest Whitepaper
The View from the New “Single Window”
The single window, officially known as the "International Trade Data System," operates via the Customs and Border Protection (CBP) agency's Automated Commercial Environment (ACE) platform, and serves as a single point of contact for all trade filings.
Download Today!
From the March 2017 Issue
WMS vendors are stepping up to the plate and developing functionalities and solutions that meet the complex needs of today’s companies. Our top analysts take a peek into these developments and discuss the DC of the future and the software that will support it.
5 Supply Chain Trends Happening Now
2017 Warehouse/DC Equipment Survey: Investment up as service pressures rise
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
2017 Trucking Regulations & Infrastructure Update
In this session our panel brings shippers up to date on the state of transportation regulations. Discussion will revolve around regulatory reform, aspects of the federal highway bill and what the transportation landscape looks like in the early days of the Trump administration.
Register Today!
EDITORS' PICKS
LM Exclusive: Major Modes Join E-commerce Mix
While last mile carriers receive much of the attention, the traditional modal heavyweights are in...
ASEAN Logistics: Building Collectively
While most of the world withdraws inward, Southeast Asia is practicing effective cooperation between...

2017 Rate Outlook: Will the pieces fall into place?
Trade and transport analysts see a turnaround in last year’s negative market outlook, but as...
Logistics Management’s Top Logistics News Stories 2016
From mergers and acquisitions to regulation changes, Logistics Management has compiled the most...