Product return and logistics knowledge: Influence on performance of the firm

Survey data on reverse logistics processes from 284 Spanish firms are used to test a structural model that analyzes the importance of returned materials and the creation of logistics knowledge within processes of reverse logistics and their effects on organizational performance. The results show that the cost of reverse logistics and the value of returns were found to be positively related to reverse logistics activities. Further, their proper management and the creation of logistics knowledge that improves organizational performance.

► We model the importance of cost of returns for reverse logistics activities.
► The cost of reverse logistics is positively related to reverse logistics activities.
► The greater the cost of returns the lower will be the return value of the materials.
► Creating new logistics knowledge helps firms to face the high variability of returns.
► Managing cost returns influences organizational performance positively.