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Identification of barriers of reverse logistic in backhoe loader segment at dealership level

Forschungsarbeit 2007 8 Seiten

Ingenieurwissenschaften - Wirtschaftsingenieurwesen



Ravindra Pathak

Lecturer, Venkteshwar institute of technology, Indore India


Reverse Logistics deals with the processes associated with the reverse stream from users/owners to re-users. The carrying back of goods sold to the market has grown to be an important area of the logistics system. The aim of this paper is to propose a framework & identify the barriers of reverse logistic for backhoe loader segment in dealership for a reverse logistics system. This paper is mainly concentrated to the backhoe loader industry, which is a Separate segment within the construction equipment industry. The construction equipment market is categorized into three segments; heavy equipment, compact equipment and the backhoe loader (BHL). The BHL segment has grown rapidly during the years and is today the fourth largest in the world, with annual sales of about 4000 products. The market for BHL is predicted to continue to grow by 6-8% for the next two to three years. The market share for high technology and quality products is expected to increase as a part of total sales. The backhoe loader Market in India is the fourth largest in the world and the attention from all the major global actors has increased in recent years, mainly due to the reforms of privatization, liberalization and the huge potential in the market. There are a number of specifics typical for the Indian market, such as high price sensitivity due to the constant alternative of the low cost labor, and additionally the heavy usage of products, which are not likely to be found in other more developed markets. In order for JCB India to build long-term relationships with customers, trust and commitment are key factors. Additionally, this paper includes an in-depth analysis of operation and the barrier of reverse logistic in this segment.


Reverse logistic, backhoe loader

1. Introduction

Supply chains are undergoing radical transformations due to the mega-competition taking place on a global scale. Technological changes are becoming a primary driver in the domain of businesses. ICLE IN PRESS Companies are finding that they must deal with a high level of uncertainty, which is not only technical in nature. It is being observed by companies that there is an increase in the flow of returns of the product due to product recalls, warranty returns, service returns, end-of-use returns, end-of-life returns, and so on. Reverse logistics stands for all the operations related to the reuse of used products, excess inventory of products and materials including collection, disassembly and processing of used products, product parts, and/or materials. Economic, environmental or legislative reasons have also increased the relevance of reverse logistics in the present-day scenario. Many industries have adopted reverse logistics practices. Review the case studies on logistics network design in different industries. Some industries have also engaged third parties for providing reverse logistics services. Have dealt with a model for reverse logistics entry by third-party providers. Identify the major barriers that hinder the application of policy relevant information, derived from analytical techniques, to practical decisions by actual decision makers.

The concept of reverse logistics has received growing attention in the last decades, due to a number of factors. Competition and marketing motives, direct economic motives and concerns with the environment are some of the important of them. With the legislative measures tightening up, there are not many options left with the companies, but to go for reverse logistics practices. The implementation of these may be a risky endeavor for the top management as it involves financial and operational aspects, which determine the performance of the company in the long run. A critical analysis of the barriers hindering reverse logistics can be a valuable source of information to decision makers.

Construction equipment industry is flooded with like JCB, L&T, Caterpillar etc., setting up manufacturing bases in India. These industries invest a great deal of resources in terms of capital, labor, energy, and raw materials in delivering goods and services to customer. When the products complete their life cycle, an important question that remains to be answered is what would be the ultimate fate of these products. Thus, the reverse distribution of the process of bringing products from the retailer level through the distributor back to the supplier or manufacturer is an important factor, which needs consideration. The reverse logistics assumes tremendous importance in this context. Reverse logistics is extensively used in the industry and many other industries are following suit. However, the deployment of reverse logistics is not free from barriers. Some of these barriers are lack of systems, management inattention, financial resources, personnel resources, lesser importance of reverse logistics relative to other issues, and company policies. The above-mentioned barriers not only affect the operations of reverse logistics but also influence one another. Thus, it is very essential to understand the barriers. The identification of the barriers that are at the root of some more barriers and those which are most influenced by the others would be helpful for the top management implementing the reverse logistics programs.

2. Methodology

2.1 Objective of the Study

(A) Primary objective: The Primary objective of the paper is study of reverse logistic in backhoe loader dealership.
(B) Secondary objective: The Secondary objective of the paper is identification the barriers of reverse logistic in Backhoe Loader segment and also the consecutive losses due to these barriers.

2.2 Introduction to the Organization

Bhopal motors limited has the dealership of the JCB India limited. BML is located at Indore (M.P.). It is a large & diversified professionally managed group whose activities include automotive dealership of international brands VIZ. General Motors, Ford, JCB India Ltd. The Company has grown rapidly and is currently the largest dealership company in Madhya Pradesh. The Company has a management that is totally professional and its approach is on par with the best companies in India. BML Trade in , inspection, separation, and so on, leading to e.g. remanufacturing or recycling. Material recapture and product or equipment (partial) reuse is a very old practice.

In the past, the primary motivation was scarcity of resources. However, the emergence of cheap materials and advanced technology led Western societies into mass consumption and routine throw away. By then, environmental matters or sustainable development were not objects of concern. In the early seventies however, drawing attention to the need of sustaining the course of civilization. During the following decade environmental disasters kept the mind of the academicians, politicians, the media, and society in general addressed to such issues. Terms like recycling, reuse, resource reduction, environmental manufacturing responsibility and green products began to be familiar to all of us.. More recently, real examples like the remanufacturing of mobile phones have pointed out the profitability of recovery activities and its value-creation rather then environmental aspects .In addition, competition, marketing or strategic arguments have pushed companies into generous return policies. Subsequently, as good as new returned products earthmoving equipment Sales & Service , mainly deal in 3D excavators, chain mounted, skid steer loader, vibrators, compactors, concrete equipment, finance construction equipment, parts.

2.3 Reverse logistic system:

Reverse logistics is the logistics process of removing new or used products from their initial point in a supply chain, such as returns from consumers, over stocked inventory, or outdated merchandise and redistributing them using disposition management rules that will result in maximized value at the end of the items original useful life. . A reverse logistics operation is considerably different from forward logistics. It must establish convenient collection points to receive the used goods from the final customer or remove assets from the supply chain so that more efficient use of inventory / material overall can be achieved. pools or warehouses for storage, returning goods to the original manufacturer for reimbursement, selling goods on a secondary market, recycling assets, or a combination that will yield maximum value for the assets in question Reverse Logistics concerns activities associated with the handling It requires packaging and storage systems that will ensure that most of the value still remaining in the used good is not lost due to careless handling. It often requires the development of a transportation mode that is compatible with existing forward logistic system. Disposition can include returning assets into inventory and management of equipment, products, components, materials or even entire technical systems to be recovered. Recovery can simply be just reselling a product. Or, it can be accompanied by a series of processes as collection are re-distributed in the same market. Summarizing, more and more {businesses and (non-)governmental organizations are being committed to material and product value recovery activities.

2.4 Backhoe Loader:

Backhoe loader, also called a Loader backhoe, and commonly shortened to Backhoe, is an engineering vehicle, which consists of a tractor, fitted with a shovel/bucket on the front and a small backhoe on the back. Due to its (relatively) small size and versatility, backhoe loaders are very common in urban engineering and small construction projects (such as building a small house, fixing city roads etc).

The backhoe loader was invented in the UK in 1953 by Joseph Cyril Bamford, founder of JCB, by equipping a farm tractor with both a backhoe and a front-mounted loading bucket. Although based on a tractor, when both the loader and the backhoe are permanently attached the vehicle is almost never called a tractor, is not generally the rear to face the hoe controls. Removable backhoe used for towing. When the backhoe is permanently attachments almost always have a separate seat on the attached, the machine usually has a seat that can swivel to attachment itself.

2.5 Reverse logistic system in dealership

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Table 1.1 Steps Involved in Reverse Logistic at Bhopal Motors



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Titel: Identification of barriers of reverse logistic in backhoe loader segment at dealership level