The future of supply chain is called Omni Chain.
One of the most important emerging trends is missing in the article by Jeroen van den Berg about the future of supply chains. Reuse of goods and articles.
In fact, return logistics has always been the orphan of supply chains. Supply chains and models are almost without exception geared towards a forward flow. Return logistics are like the salmon swimming against the river. Tricky, expensive and difficult to control.
Cradle to cradle.
For some time C2C has been a hype but slowly faded into the background. Due to the economic crisis, consumers have taken up the baton again. And the Government and Europe also regularly tighten legislation to encourage reuse, because more and more raw materials are heading towards their peak. And gradually with increasing success.
As a result of the separation of waste by consumers and technological developments at waste companies, the recovery of waste flows has increased sharply since 1995. In recent years, large waste processors have repositioned themselves as recycling companies and have left their traditional position of incinerator of waste.
The consumer is not unaffected. More and more articles get a 2nd or 3rd life through marketplace or special second-hand websites. Goods are traded quickly at a low price. The number of second-hand shops is also increasing sharply. In recent years, the floor space and turnover of second-hand shops have increased by an average of 5% per year. The shops no longer have the ‘goat wool socks’ image but are highly professionalised. Consumers hand in their articles for a small fee, which are then refurbished and resold.
But traditional supply chains will also increasingly be confronted with these trends. The European legislator is making increasing demands on the possibilities for reuse and will also set requirements for the return flow in the coming years. Think of the intake of brown and white goods.
As Jeroen vd Berg rightly argues in his article, the use of technology and data is essential in the future. Not only for the traditional supply chain but even more in the omni chain. Knowledge about the raw materials present, processed in products, offers opportunities to include these in the Source Plan of an organization. [controlled] Within the network of the omni chain, continuous information will be exchanged about recycle flows [Connected] Not only the upward flows but also the returns present at the various sales points can be collected in this way [consolidated]
Mobile phones are already exchanged with subscriptions, but retailers also have special promotions to return your old phone for reuse.
Goods will not only consist of new raw material, but also recycled. Refurbishing plastic, for example, gives products the same external quality features. Due to the success of thrift stores and their professionalization, the classic retail stores will be ‘forced’ to offer this service within their sales concept.
The C2C principle has never really disappeared, but is now moving from a mechanical, mainly government-driven development, to a mature market. The need for reuse on the one hand and the possibilities of contemporary technology now offer ample opportunities to use the return flows efficiently and cost-effectively. As a result, the volume pressure on regular raw material flows will decrease, as will the associated cost increases.
The thrift market is still largely outside the scope of regular retail. This provides an additional unpredictability of demand development. By entering this market, retailers gain more insight into customer behavior and realize more turnover by expanding their sales concept. This is the most important step towards realizing the omni chain.