REVERSE LOGISTICS PRACTICES AND SALES GROWTH OF MANUFACTURING FIRMS IN NIGERIA (STUDY OF STARLINE NIGERIA LIMITED, ABIA STATE)

CHAPTER ONE

INTRODUCTION

1.1  BACKGROUND OF THE STUDY

Reverse logistics, sometimes known as "product take-back," is one of the principles covered under the Supply Chain Management umbrella (SCM). Reverse logistics refers to a procedure in which a producer collects previously transported items from the point of consumption for recycling and recovery (Fortes, 2009). It entails recovering the product from the ultimate customer in order to capture value or dispose of it properly. Due of the apparent advantages associated with reverse logistics, it has recently gained prominence. Enhanced economic performance, decreased environmental degradation, increased social performance, and increased operational performance are just a few of the advantages.

Product returns will always be a problem as long as items are created and sold and how businesses manage the product return (reverse logistics) process has a significant influence on organizational success. Reverse logistics is gradually becoming a source of competitive advantage for organizations, making it a strategic choice to pursue this role. Despite these advantages, industrial companies in Nigeria do not seem to have absorbed and embraced the notion. Starline Nigeria Limited is a Nigerian cosmetics manufacturer that also participates in reverse logistics. In order to capture value via creating value for customers and distributors return defective items as a consequence of leaks, damages, or breakages in transit via the company's product distribution operations. Other items are returned for repackaging or remanufacturing, depending on the situation.

Even though it is frequently concealed, reverse logistics may result in large expenses but also give countless possibilities, and so may be considered an important feature and component of the supply chain (Horowitz, 2010). Many businesses do not believe reverse logistics to be a profitable supply chain technique. Furthermore, several obstacles or restrictions prevent many firms, such as Starline Nigeria Limited, from participating in reverse logistics operations (Zhang, 2010). Other organizations consider the approach to be disruptive. The cause of this issue is a lack of top management understanding and commitment to reverse logistics, as well as their inability to see the advantages of this supply chain technique (Azevendo, et. al., 2011). Because of poor client patronage and failure to please consumers, firms' negligence may have a detrimental impact on their marketing performances.

1.2  STATEMENT OF RESEARCH PROBLEM

Normally, every firm focuses on enhancing its forward logistics operations. Most companies have failed to pay comparable attention to reverse logistics as they have to forward logistics. Most industrial companies focus so much on forward logistics that they underestimate the relevance of reverse logistics operations and their ability to improve the organization's and supply chain's performance. For most businesses, reverse logistics is considered as a source of disruption, a cost center, and a potential source of customer satisfaction.

This study seeks to investigate the effect of reverse logistics and sales growth of Starline Nigeria Limited in Abia state.

1.3  OBJECTIVES OF THE STUDY

1.    To fully explain the concept of reverse logistics as it applies to manufacturing companies.

2.    To examine the importance of reverse logistics in boosting sales growth of Starline Nigeria Limited.

3.    To examine the effects of reverse logistics on the sales and growth of Starline Nigeria Limited.

1.4  RESEARCH QUESTIONS

1.    What is the concept of reverse logistics as it applies to manufacturing companies?

2.    What is the importance of reverse logistics in boosting sales growth of Starline Nigeria Limited?

3.    What are the effects of reverse logistics on the sales and growth of Starline Nigeria?

1.5  SIGNIFICANCE OF THE STUDY

This study will be an addition to the academic world as it will be an addition to other works that have been conducted on reverse logistics. This study will also be helpful to Starline Nigeria Limited as it will aid them in understanding the importance and effects of using reverse logistics in the manufacturing process.

1.6  SCOPE OF THE STUDY

This study will only cover the effects of reverse logistics on the growth of sales in Starline Nigerian Limited. It will also take an in-depth look into the concept of reverse logistics as it applies to manufacturing companies. It will also look at the effects of using reverse logistics on the growth and sales of Starline Nigeria Limited.

1.7  LIMITATIONS OF THE STUDY

The researcher while undertaking this study was limited by time only.

1.8  OPERATIONAL DEFINITION OF TERMS

REVERSE LOGISTICS: Reverse logistics is for all operations related to the reuse of products and materials. It is "the process of moving goods from their typical final destination for the purpose of capturing value, or proper disposal.

GROWTH: The process of increasing in efficiency, clientele and all other sections an organization.

SALES: the exchange of a commodity for money, in this case, the exchange of beauty commodities produced by Starline Nigeria Limited.