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2021

Reverse Logistics Market

Reverse Logistics Market Size, Share, Competitive Landscape and Trend Analysis Report by Return Type (Recalls, Commercial & B2B returns, Repairable returns, End of use returns and End of life returns), End User (E-commerce, Automotive, Pharmaceutical, Consumer Electronic, Retail, Luxury Goods, and Reusable Packaging), and Service (Transportation, Warehousing, Reselling, Replacement Management, Refund Management Authorization, and Others): Global Opportunity Analysis and Industry Forecast, 2021-2028

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Author's: Mayank Halmare| Aditya Chandra | Lalit Janardhan Katare
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Reverse Logistics Market Statistics 2028 -

The global reverse logistics market valued $635.6 billion in 2020 and is projected to reach $958.3 billion in 2028, registering a CAGR of 5.6%.    

The growth of e-commerce businesses around the world has increased the number of returns and replacement items and the need for an efficient reverse logistics service. The demand for reverse logistics services to enable unhindered client satisfaction is growing around the world as manufacturers become more aware of the need to reduce negative environmental impact. Reverse logistics is an important part of the supply chain in a variety of industries, including automotive, electronics, pharmaceuticals, and others. Reverse logistics services have been developed and implemented by countries all over the world to extract value from returned and damaged products. Reverse logistics activities involve warehousing, reselling, recycling management, returns management, replacement management, and environmental compliance.

Reverse-Logistics-Market,-2021-2028

In the forecasted timeframe, the global reverse logistics industry is projected to expand due to increased innovation and the development of automation technologies. The growth of the reverse logistics business is also aided by greater government funding for the establishment of transportation infrastructure. For instance, the Brazilian government announced plans for a $50 billion investment in airports, ports, motorways, and railways in May 2021. The improvement of transportation infrastructure will make it easier for reverse logistics companies to operate in the region. Rising retail sales, a rise in the launch of innovative electronic items, and strong government regulations against the sale of dangerous goods to customers have all contributed to increased investment in reverse logistics services around the world. For instance, Delhivery, a logistics startup based in Gurgaon, revealed in May 2021 that it had raised $275 million in a fundraising round. The funding will be utilized towards expanding the company's reverse logistics, cross-border, B2B and B2C warehousing, express parcel delivery, end-to-end supply chain services, and technology services.

The global reverse logistics market is segmented into return type, end user, and service. By return type, it is further divided into recalls, commercial & B2B returns, repairable returns, end of use returns, and end of life returns. Depending on the end user, it is fragmented into e-commerce, automotive, pharmaceutical, consumer electronic, retail, luxury goods, and reusable packaging. By service, the reverse logistics market is classified into transportation, warehousing, reselling, replacement management, refund management authorization, and others. Region-wise, the market is analyzed across North America, Europe, Asia-Pacific, and LAMEA.

Key players operating in the global reverse logistics market include C.H. Robinson Worldwide, Inc., CCR Logistics Systems AG, 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  

Expansion of e-commerce industry

The global logistics and e-commerce market has experienced tremendous growth in the recent years owing to the rise in connectivity solutions. The growth in e-commerce and logistics industries drives the demand for time-efficient delivery and return services for the transportation of goods in forward and reverse logistics worldwide. For instance, in May 2021, XPO Logistics, Inc. has announced the launch of an automation solution in France. The automation solution is anticipated to facilitate high-volume reverse logistics in the French fashion e-commerce industry. The unprecedented growth of online shopping in the recent years has promoted the development and adoption of reverse logistics services and solutions by the leading retail, e-commerce, and third-party logistics companies (3PLs) For instance, in June 2021, Ruby Has launched an industry alliance DTC Consortium with the support of multiple companies. The consortium is expected enable the organizations to comprehensively navigate through their market strategies such as reverse logistics, marketing, fulfilment, vertical-specific considerations, and more. The returns segment of the e-commerce industry has become a critical component of the retail customer experience and thereby drives the adoption of reverse logistics services across the e-commerce industry.

The increase in the adoption of reverse logistics services to enhance the customer experience is the key driving factor propelling the growth of the reverse logistics market during the forecast timeframe.  

Reverse Logistics Market
By Return Type
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End of Life Returns is projected as the most lucrative segments

Increased product recall due to stringent government rules for product quality in the automotive industry 

The global automotive industry has observed a rise in decentralized production owing to a rise in demand for high-quality automotive parts. The installation of an inferior quality part in automotive can lead to fatal accidents, which anticipate the involvement of the government in the prevention of accidents by invoking regulations and law. The government involvement in the utility of automotive manufacturing and deployment has further boosted the growth of the reverse logistics market. For instance, in February 2019, automotive giants namely Subaru, Tesla, BMW, Volkswagen, Audi, Daimler Vans, Mercedes-Benz, and Ferrari had to recall their vehicles owing to the faulty airbag installed in those vehicles. The airbags supplied by Takata Corp. can be triggered to deploy without an accident and spray shrapnel into passengers and drivers. In addition, the increase in the adoption of electric vehicles drives the number of electric vehicle batteries being circulated in the world. The batteries at the end of life need to be recycled which creates an opportunity for the growth of the reverse logistics market. 

For instance, in May 2021, MG Motor India and Attero announced a partnership for recycling electric vehicle batteries. Under the partnership, Attero will provide reverse logistics, refurbishing, and recycling solutions to MG Motor India. Automotive manufacturers are adopting reverse logistics services to reduce e-waste and ensure passenger safety.

The above-mentioned factors such as the rise in adoption of reverse logistics by leading automotive manufacturers owing to the government regulations for passenger safety and minimizing e-waste fuels the growth of the reverse logistics market during the forecast timeframe.      

Reverse Logistics Market
By End User
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E-commerceis projected as the most lucrative segment

Lack of control of manufacturers on reverse logistics service 

The manufacturer and retailers are completely dependent on the reliability, competency, and honesty of logistics service providers. In this scenario, the manufacturing or retailing company is 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. 

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. The barriers such as lack of coordination at the CEO level and non-alignment of short and long-run strategic goals of the company also restrict the adoption of reverse logistics services. Thus, the lack of control of manufacturers on reverse logistics service is anticipated to hinder the growth of the reverse logistics market.

Reverse Logistics Market
By Service
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Replacement Management is projected as the most lucrative segment

Introduction of Blockchain technology 

Technological advancement such as Block-chain enables 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 also helps in tracking returns and identification of issues for high return rates.

The evolution of advanced blockchain technology for reverse logistics services presents an opportunity for the growth of the reverse logistics market. 

Reverse Logistics Market
By Region
2028
Asia-pacific 
North America
Europe
LAMEA

Asia Pacific would exhibit the highest CAGR of 6.2% during 2020-2027.

COVID-19 Impact Analysis 

  • The COVID impact on the reverse logistics market is unpredictable and it is expected to remain in force till the second quarter of 2021. 
  • The COVID-19 outbreak forced governments across the globe to implement strict lockdowns and made social distancing mandatory to contain the spread of the virus. This led to a sudden downfall in global trade which further reduced the demand for reverse logistics across the world. 
  • Moreover, the nationwide lockdown forced the reverse logistics service providers to partially or completely shut their operations which resulted in delays in the return and replacement activities.
  • The rise in pharmaceutical and e-commerce sales owing to the pandemic has increased the demand for the reverse logistics market.

Key Benefits For Stakeholders

  • This study presents the analytical depiction of the global reverse logistics market analysis along with the current trends and future estimations to depict imminent investment pockets.
  • The overall reverse logistics market opportunity is determined by understanding profitable trends to gain a stronger foothold.
  • The report presents information related to the key drivers, restraints, and opportunities of the global reverse logistics market with detailed impact analysis.
  • The current reverse logistics market is quantitatively analyzed from 2020 to 2028 to benchmark financial competency.
  • Porter’s five forces analysis illustrates the potency of the buyers and suppliers in the industry.

Reverse Logistics Market Report Highlights

Aspects Details
Reverse Logistics Market By Return Type
By Return Type
  • Recalls
  • Commercial Returns
  • Repairable Returns
  • End-of-use Returns
  • End of life returns
Reverse Logistics Market By End User
By End User
  • E-commerce
  • Automotive
  • Pharmaceutical
  • Consumer Electronic
  • Retail
  • Luxury goods
  • Reusable packaging
Reverse Logistics Market By SERVICE
By SERVICE
  • Transportation
  • Warehousing
  • Reselling
  • Replacement Management
  • Refund Management Authorization
  • Others
Reverse Logistics Market By Region
By Region
  • North America  (U.S., Canada, Mexico)
  • Europe  (UK, France, Germany, Italy, Rest of Europe)
  • Asia-Pacific  (China, Japan, India, South Korea, Rest of Asia-Pacific)
  • LAMEA  (Latin America, Middle East, Africa)
Key Market Players
Key Market Players

YUSEN LOGISTICS CO.,LTD., C.H. ROBINSON WORLDWIDE, INC., UNITED PARCEL SERVICE, INC., DB SCHENKER (DEUTSCHE BAHN GROUP (DB GROUP)), DEUTSCHE POST DHL GROUP, KINTETSU WORLD EXPRESS, INC., SAFEXPRESS PVT. LTD., FEDEX CORPORATION, CCR LOGISTICS SYSTEMS AG, CORE LOGISTIC PRIVATE LIMITED

Analyst Review

The global reverse logistics market is expected to witness significant growth due to the rise in e-commerce platforms around the world.

The expansion of e-commerce industry, increased product recall due to stringent government rules for product quality in the automotive industry, and rise of tech-driven reverse logistics services and growing adoption of IoT-enabled connected devices, are expected to drive the global reverse logistics market growth over the forecast period. However, lack of control of manufacturers on reverse logistics service and uncertainty in the reverse logistics process is anticipated to hamper the growth of the market during the forecast period. Moreover, introduction of Blockchain technology and reduction in losses owing to adoption of a multi-modal system is expected to offer lucrative opportunities for the market in the future.

Reverse logistics solutions are effective solutions that allow customers to return products to manufacturers for a variety of reasons, including the wrong product being ordered, damaged products being delivered, product quality not matching the description, the customer no longer needing the products, and so forth. The reverse logistics service also aids vendors in managing the massive volume and cost of returns processing.

Manufacturers benefit from reverse logistics since it enables them in maximizing asset utilization while lowering losses. Manufacturers can also benefit from reverse logistics services in terms of environmental sustainability. In addition, reverse logistics helps the organization in reducing expenses in areas like administration, transportation, and aftermarket support. By paying more attention to faulty items and merchandise repairs, reverse logistics services boost customer happiness and loyalty.

Among the analyzed regions, Asia Pacific is the highest revenue contributor, followed by North America, Europe, and LAMEA. Based on forecast analysis, Asia Pacific is expected to maintain its lead during the forecast period, owing to the boom of e-commerce and the increase in e-waste in the region.

Author Name(s) : Mayank Halmare| Aditya Chandra | Lalit Janardhan Katare
Frequently Asked Questions?

The global reverse logistics market was valued at $ 540.29 Billion in 2020, and is projected to reach $ 788.78 Billion by 2028, registering a CAGR of 5.1% from 2021 to 2028

The lifting of lockdown measures and the consequent resuming of transportation activities across the globe is anticipated to support the revival of global reverse logistics market.

The report sample for global reverse logistics market report can be obtained on demand from the website.

Introduction of Blockchain technology in reverse logistics service

Expansion, Partnership, and Product launch are the top most competitive developments which are adopted by the leading market players in the global reverse logistics market.

The company profiles of the top players of the market can be obtained from the company profile section mentioned in the report. This section includes analysis of top ten player’s operating in the industry along with their last three-year revenue, segmental revenue, product offerings, key strategies adopted, and geographical revenue generated.

Based on the reverse logistics market analysis, Asia-Pacific region accounted for the highest revenue contribution in 2020 and is expected to see lucrative business opportunities during the forecast period.

By return type, the End of Life Returns segment is expected to gain traction over the forecast period

The U.S. and China are key matured markets growing in the global reverse logistics market.

The lack of control of manufacturers on reverse logistics service; and reduction in losses owing to adoption of a multi-modal system.

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Reverse Logistics Market

Global Opportunity Analysis and Industry Forecast, 2021-2028