I interviewed John McCombs who discussed Reverse Logistics and The Key of Having Talented People.
It’s great to speak with you today, John. I’m looking forward to hearing your views today on reverse logistics and the key of having talented people. Can you start by providing a brief background of yourself?
Yes, I’ve been in reverse logistics for about the past 20 years. I came in to the supply chain management business and found myself in reverse logistics. In that process, I have been exposed to many different types of commodity vehicles, ranging from Marine machine tools, electronic tests, medical, dental, scrap. The succession of different positions has increased responsibility. It’s been a fascinating industry, and I’ve watched it grow, I’ve watched it expand. I think it certainly, at the beginning of its start, I think that’s exciting; that’s why I would like to highlight it. The young people coming in to the supply chain management industry, that’s why I think you should take a look at the reverse supply chain business, because there’s a lot of upside, a lot of opportunity. We’re at the beginning; we’re not a mature industry.
Thank you. My first question is: How do you define reverse logistics? Is this definition evolving?
One answer is, yes, it is evolving. I think we’re still figuring those things out. How I define it is a manufacturer manufactures something. Okay, it’s done. The first user has used it. That could be a truck over the road that’s 600,00 miles and they want to sell it; it could be a piece of medical equipment in the United States, an X-ray machine; that a new X-ray machine has come out…that used X-ray machine in the United States is cutting-edge in Africa or the second world. Reverse logistics is about used stuff, and it ranges from consumer returns, where somebody gets something and immediately return it in a matter of weeks—usually, that kind of property depreciates rather rapidly—to construction equipment, machine tools, to medical. Most of the time, those assets do depreciate over time, but you will see occasionally, some assets do appreciate in value.
The other thing is scrap. The scrap industry is part of, I consider it part of reverse supply chain. It keeps things out of the landfill; it keeps things back. It’s usable because they’ll take the materials and send them back, and they’ll make them usable again.
Can you talk about some of the challenges with this industry and where you see it going?
We have to attract talented people to the business. Overall, the supply chain business, it’s all about getting quality people. With that, the right people with the right experience. If you’re in the medical-surplus business, you’re going to want people who are knowledgeable about medical surplus. If it’s trucks, you want knowledgeable truck people. If it’s Marine equipment, you want knowledgeable people. You want people who can learn quickly because things change quickly here. What could be usable today in one year may be obsolete, are not being able to be used a year from now. It’s a business that quickly changes. When you have something like that, having people who can side-think, make decisions, they’re critical.
Is there anything more you can say about how reverse logistics can be done effectively?
I think it needs to start in the forward supply chain; I think at the beginning. When you’re talking about manufacturing an item, when you’re talking about making an item, you should incorporate what the end state is. It’s not just the first user. I think manufacturers are wise on creating an item, and maybe they have it as a buy-back. You buy this and when you get done with it, you’ll sell it back to us and we’ll sell you our new thing and we’re going to use your used stuff and we’ll send that to some other part of the world, so we’ll want that. Next, you should look at the manufacturer and the forward supply chains. You don’t want to create an item necessarily that’s environmentally hazardous; you want something that can be, if it has to be, turned into possible scrap, that can be recycled and sent back into forward supply chains. I think, Dustin, one of the things I see is that incorporating the reverse supply chain piece in the forward supply chain means that’s critical to turning what has historically been a cost center into a profit center as part of the business.
Thank you. Did we cover all the points you wanted to make today?
About John McCombs
Senior Executive in the | Supply Chain | Logistics | 3PL Industry