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01/02/2011
UKWA member iForce has launched a service which is
thought to be the first of its kind in the outsourced logistics
sector - a refurbishment and remarketing arm that will
deliver an increase in financial returns to its clients.
Mark Kiteley, who will head up the new operation,
explains how the process will work profiting from
the ‘3Rs’
This new business within the iForce
Group is responsible for adding value
to the company’s existing reverse logistics
offering through a service that will refurbish
and remarket clients’ returned products.
This service, which is thought to be the first
of its kind in the outsourced logistics sector,
will be offered to new clients and as an
embedded service to existing iForce clients.
The new business sector is headed by
Mark Kiteley, who has designed a quality
refurbishment process that turns a returned
product into a saleable item of the same
standard of operational quality as it had
when manufactured.
Although consumer
electronics are the predominant sector for
iForce’s refurbishment and remarketing service
it can equally be applied to any high-tech
product.
For over a decade, iForce has been developing
its expertise in reverse logistics by
managing the returns of product back via its
Saltley returns processing centre in
Birmingham, or at one of a number of its
dedicated client facilities, and then either
selling it on or disposing of it as directed by
the client.
With the new service, rather than simply
sell on raw returned product for a client to a
jobber for a nominal fee, iForce can now
add value by refurbishing that stock for a
fixed cost, which means the client knows
what will be charged for every saleable item.
iForce will then sell the refurbished items at a
good price with an iForce warranty, allowing it to return a greater financial benefit to the
client.
The first refurbishment line has been
established at iForce’s Saltley returns processing
centre and the company has identified
areas for similar facilities at other sites. The
first technician was hired in the first week of
September and product began rolling off the
line a week later.
Returns requiring refurbishment arrive on
pallets and leave the line boxed ‘as new’
ready for remarketing. The refurbishment
technicians have a quality process for each
product to ensure it is as good as new when
it leaves. If at any time in the process repair
work has to be carried out, the operative
makes the technical decision and when fixed,
carries on with the process. Any product that
can’t be repaired will have all its useable
parts recovered and the rest will be scrapped
in accordance with the WEEE Directive and
the recovered credits for precious metals
returned.
The objective of the refurbishment facility is
clear: to achieve the highest possible yield with
the highest quality and reliability factor built in.
The technicians’ work is measured through productivity and returns satisfaction ratings.
Reclassifying the refurbished product and
giving it a new serial number will ensure it
does not re-enter the service loop of either
the manufacturer or retailer; they will never
see the product again.
iForce then manage the onward sale
through the remarketing arm of the process.
This will involve iForce’s existing Buy-force™
platform, the B2B auction web site
(www.buy-force.com) that currently trades
large tranches of returned stock for existing
iForce clients. Buy-force™ will now also be
offering individual items to online shoppers
as a B2C site. iForce’s customers can tap
into the company’s efulfilment expertise to
provide a direct channel for these products.
This service also provides a direct channel
for clients wishing to sell their excess
and end of line stock, which can no longer
be sold through their primary retail channel
and would normally be sold to a jobber.
iForce can take this product and through its
service element, add its own warranty, thus
relieving the manufacturer / retailer of the
ongoing responsibility of that stock, while
prolonging its sales life to deliver ongoing
financial benefits for the client.
Mark Kiteley commented: “Up to 85% of
all returned product can be refurbished and
remarketed making this very environmentally
friendly and sustainable for both us
and our clients. The product leaving the
refurbishment process is as good as new.
The end customer gets a bargain – at least
20% discount on high street retail prices –
and still receives the same consumer protection
provided by any retailer, such as the
Distance Selling Regulations and the
Consumer Protection Act.”
He continues: “Returns are inevitable for
retailers and manufacturers and while companies
have started to manage this asset to gain
some value back; having a solution in place to
gain the optimum value from those returns
simply makes good sense. Through our new
service, iForce can deliver back the optimum
value for the returned product as opposed to a
nominal amount gained by sending a raw
return on to a jobber as an unknown.”
Clients can also gain valuable data from
the process. A manufacturer can be
informed of an inherent fault if, for example,
a high percentage of returns have the
same problem. For retailers, iForce can
analyse the different acceptance criteria for
returns from a number of store locations.
For example one store in a network may
never send back remote controls for the
returned TVs. Retailers can then enhance
their acceptance criteria according to the
statistical feedback. Other issues can be
passed on as they come to light.
Mark Hewitt, CEO of iForce, commented:
“With refurbishment and remarketing
now part of our repertoire alongside our
returns processing offering, for both existing
and new clients, iForce now offers an holistic
reverse logistics solution – in essence the ‘3 Rs’
– returns, refurbishment and remarketing! The
new services add further value to our specialist
logistics operations as we can take return stock
from any customer then catalogue, sort, refurbish
and remarket it. In addition to offsetting
the cost of the returns process this will deliver
even greater margin straight onto the
client’s bottom line.”