Reverse Logistics Market Research, 2032
The global reverse logistics market size was valued at $630.9 billion in 2022, and is projected to reach $947.7 billion by 2032, growing at a CAGR of 4.3% from 2023 to 2032.
Report Key Highlighters:
- The reverse logistics market analysis covers 14 countries. The research includes regional and segment analysis of each country in terms of value ($billion) for the projected period 2023-2032.
- The study integrated high-quality data, professional opinions and analysis, and critical independent perspectives. The research approach is intended to provide a balanced view of global markets and to assist stakeholders in making educated decisions in order to achieve their most ambitious growth objectives.
- Over 3,700 product literature, annual reports, industry statements, and other comparable materials from major industry participants were reviewed to gain a better understanding of the market.
- The key players in the reverse logistics market are 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. The companies have adopted strategies such as product launches, contracts, expansions, agreements, and others to improve their market positioning.
Reverse Logistics is the process of managing the return of goods from the end user back to the seller or manufacturer. It is the management of 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. These services are implemented by pharmaceutical, automotive, FMCG, and other manufacturers to improve customer satisfaction and reduce adverse environmental impact.
The automotive industry in recent years has witnessed an increase in decentralized production due to surge in demand for high-quality automotive aftermarket parts. Inadequate quality car parts result in fatal accidents, leading the government to implement strengthening regulations to avoid such incidents. The government's engagement in quality control of vehicle deployment by agencies to look after the production of automobiles has accelerated the reverse logistics business.
For instance, on January 20, 2024, Toyota Motor Corporation announced that 50,000 of the U.S. vehicles are unsafe to drive due to defective airbags. The company announced its customers to halt driving vehicles called for immediate recall due to the risk of a faulty airbag inflator that has the potential to explode and seriously injure or kill the driver or passengers. Vehicles manufactured by 19 different automakers, such as Subaru, Tesla, BMW, Volkswagen, Audi, Daimler Vans, Mercedes-Benz, and Ferrari, have been asked to replace these airbags. The airbags were made by Takata Corporation and were installed in most of the car models launched in between the year 2002 and 2015. Since then, 67 million airbags have been recalled, and at the end of 2022, 11 million were still being replaced.
Similarly, in May 2021, MG Motor India and Attero announced a partnership for recycling electric vehicle batteries. Under the partnership, Attero is expected to provide reverse logistics, refurbishing, and recycling solutions to MG Motor India. Automotive manufacturers have adopted reverse logistics services to reduce e-waste, ensure passenger safety, and safely disposal of automotive components. Thus, the rise in the adoption of reverse logistics by leading automotive manufacturers owing to the government regulations for passenger safety and minimizing e-waste is anticipated to fuel the reverse logistics market forecast during the review period.
The global reverse logistics market trends 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. However, factors such as lack of control of manufacturers on reverse logistics service and uncertainty in the reverse logistics process hinder market growth. Furthermore, introduction of blockchain technology and reduction in losses owing to adoption of a multi-modal system are anticipated to provide lucrative market growth opportunity.
Key Developments in Reverse Logistics Market
The leading companies have adopted strategies such as acquisition, agreement, expansion, partnership, contracts, and product launches to strengthen their market position.
- On October 20, 2023, DB Schenker inaugurated its new warehouse facility in New South Wales. The new facility is expected to look after providing service for some of the major electronic giants in the country and is projected to offer services such as customs clearance, port-to-warehouse delivery, product & spare parts warehousing, domestic outbound distribution, and reverse logistics management.
- On October 5, 2022, Deutsche Post DHL Group introduced a new recovery management solution to reduce electronic waste, including processors, touchscreens, computer modules, and other tech assets. The company developed a new circular supply chain solution that supports companies in enabling the appropriate reuse, reprocessing, or recycling of used electronic parts.
Segmental Analysis
The reverse logistics market share 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 analyzed across North America, Europe, Asia-Pacific, Latin America, the Middle East, and Africa.
By Return Type
On the basis of return type, the global reverse logistics market is segmented into recalls, commercial returns & B2B returns, repairable returns, end-of-use returns, and end-of-life returns. The commercial returns and B2B returns accounted for the largest market share in 2022, owing to the expansion of the e-commerce industry, change in customer expectations, and rise in environmental concerns. However, the end-of-life returns segment is anticipated to witness the strongest growth rate due to an upsurge in environmental concerns among manufacturers as there is the presence of hazardous materials in the end-of-life products. The demand for reverse logistics services in end-of-life products, primarily waste electrical and electronic equipment, has increased in recent years. Moreover, government agencies across the globe have implemented strict regulations for reverse logistics services for end-of-life products.
By End User
On the basis of end user, the global reverse logistics market is segregated into e-commerce, automotive, pharmaceutical, consumer electronics, retail, luxury goods, and reusable packaging. The e-commerce segment accounted for the largest market share in 2022 and is anticipated to witness the strongest CAGR growth rate during the forecast period owing to rise in volume of products ordered through e-commerce platforms and increased demand for effective reverse logistics. Product returns add about 7%-11% to the base price of items supplied, and this figure is likely to climb up, necessitating the rapid implementation of an effective reverse logistics solution. Owing to the reduced personal engagement with the products in e-commerce, the amount of goods returned is twice that of goods returned from brick-and-mortar stores.
By Region
On the basis of region, the reverse logistics market is analyzed across North America, Europe, Asia-Pacific, Latin America, the Middle East, and Africa. The Asia-Pacific region accounted for the largest market share in 2022 and is expected to witness the highest growth rate during the forecast period owing to the growing logistics industry due to expansion of the manufacturing sector in the region. Moreover, strong government assistance for the development of regional logistics infrastructure aids in the growth of reverse logistics market. Furthermore, the expanding e-commerce business in emerging economies such as India, Indonesia, Vietnam, and others is helping drive the reverse logistics market growth.
Market Dynamics
Rise of Tech-driven Reverse Logistics Services and Surge in Adoption of IoT-enabled Connected Devices
Technological advancement in FMCG and pharmaceutical 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 in 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, benefitted the reverse logistics industry show remarkable growth.
For instance, in February 2021, Sensitech launched IoT supply chain monitoring devices. These multi-modal, real-time IoT solutions devices are projected to be utilized for real-time tracking of shipments traveling by aircraft. Moreover, the digital transformation of supply chains across the globe reduces inefficiency and waste, which promotes the use of IoT-enabled devices in reverse logistics. For instance, the SmartDisposition platform, developed by Optoro, uses machine learning to determine the most profitable channel for re-routing each returned unit. Thus, the rise in such technological advancements and the increase in use of IoT-enabled devices act as a catalyst to the growth of the reverse logistics market.
Lack of Control of Manufacturers on Reverse Logistics Service
The manufacturers, retailers, and customers are completely dependent on the reliability, competency, and honesty of logistics service providers. In this scenario, the manufacturing or retailing company is fully reliant on the logistics service provider, which results in a lack of direct control. In addition, the manufacturer is not able to monitor the operations at the warehouse, which is a serious threat to the quality of products and results in product damage or deterioration in product quality.
Moreover, outsourcing to a third-party reverse logistics (3PL) company could potentially lead to a breach of confidentiality, resulting in the exposure of customer personal data or the sharing of commercially sensitive information. Thus, the lack of control of manufacturers on reverse logistics service is anticipated to hinder the growth of the reverse logistics market size during the forecast period.
Introduction of Blockchain Technology
Technological advancements such as Block-chain enable enhanced tracking and transparency of the overall lifecycle of the product beginning from sourcing of component materials by the manufacturers to the final disposal of the product. The leading market players of the logistics industry have begun testing and deploying blockchain technology for augmenting their reverse logistics operations. For instance, Walmart Canada utilizes a blockchain for automated invoice generation, which removes the time-consuming freight bill audits. The supply chain leaders have implemented a combination of block-chain and reverse logistics strategies for managing product lifecycles such as reclamation, recycling, and disposal. Blockchain technology helps to track returns and identify issues related to high return rates. The evolution of advanced blockchain technology for reverse logistics services presents a lucrative opportunity for the growth of the reverse logistics market.
Key Benefits For Stakeholders
- This report provides a quantitative analysis of the market segments, current trends, estimations, and dynamics of the reverse logistics market analysis from 2022 to 2032 to identify the prevailing reverse logistics market opportunity.
- The market research is offered along with information related to key drivers, restraints, and opportunities.
- Porter's five forces analysis highlights the potency of buyers and suppliers to enable stakeholders make profit-oriented business decisions and strengthen their supplier-buyer network.
- In-depth analysis of the reverse logistics market segmentation assists to determine the prevailing market opportunities.
- Major countries in each region are mapped according to their revenue contribution to the global market.
- Market player positioning facilitates benchmarking and provides a clear understanding of the present position of the market players.
- The report includes the analysis of the regional as well as global reverse logistics market trends, key players, market segments, application areas, and market growth strategies.
Reverse Logistics Market Report Highlights
| Aspects | Details |
 Market Size By 2032 | USD 947.7 billion |
 Growth Rate | CAGR of 4.3% |
 Forecast period | 2022 - 2032 |
 Report Pages | 280 |
 By Return Type |
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 By End User |
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 By Region |
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 Key Market Players | SAFEXPRESS, DB Schenker, Kintetsu World Express, Inc, C.H. Robinson Worldwide, Inc., FedEx, United Parcel Service of America, Inc., Core Logistic Private Limited, Deutsche Post AG, RLG, YUSEN LOGISTICS CO., LTD. |
Analyst Review
All the operations related to the movement of goods from the typical final destination to the point of origin for the reason such as refurbishment, remanufacturing, repair, and others are considered in reverse logistics. Reverse logistics is added up to the original cost of the goods, which in turn affects the stocks of the company negatively. Efficient implementation of reverse logistics can increase the revenue of companies significantly. The reverse logistics market is expected to grow at a remarkable rate in future owing to around three to four times higher than e-commerce purchases than brick-and-mortar purchase.
Expansion of E-commerce industry, stringent government rules in the automotive industry increasing product recall, and rise in need of reverse logistics in pharmaceutical industry are the factors that drive the growth of the market. However, uncertainty in reverse logistics process and increase in quality control hinder the growth of the reverse logistics market. Furthermore, introduction of Blockchain technology and rise in need of reverse logistics due to increase in e-waste holds a remarkable growth opportunity for the key players operating in the market.
Among the analyzed geographical regions, currently, Asia-Pacific is the highest revenue contributor, and is expected to maintain the lead during the forecast period, followed by North America, Europe, and LAMEA.
C.H. Robinson Worldwide, Inc., DB Schenker, FedEx Corporation are some of the major companies operating in the market.
The reverse logistics market was valued at $630.9 billion in 2022.
Asia-Pacific is the largest regional market for reverse logistics
E-Commerce is the leading application of reverse logistics.
The reverse logistics market is anticipated to grow at a CAGR of 4.3% from 2023-2032.
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