Getting Value from the Reverse Logistics Pipeline

TRANSPORTATION AND INFRASTRUCTURE Getting Value from the Reverse Logistics Pipeline For many of the major components on the Army’s weapon systems, trucks, and other major items of equipment, it often makes economic sense to repair them rather than replace them with new ones. Current acquisition and management of these systems in fact plan for and assume that this sort of repair will occur. Thus, the Army has an extensive reverse logistics system designed to reclaim as much value from these parts as possible. This system consists of both distribution and maintenance processes. Designated parts are turned in by maintainers to the supply system and directed to local and national sources of repair as appropriate. Repaired parts are then returned to the supply system to be issued to maintainers either immediately or when demands occur. At peacetime levels, two billion dollars worth (in year 2000) of such parts are returned to the system. Properly managed, the reverse logistics pipeline can yield great value in the form of: