Certified Supply Chain Professional (CSCP) Practice Exam

Which activity can generate revenue in reverse logistics?

1. Transportation management

2. Repair fees

3. Discounts on returns

4. Storage costs

The correct answer is: Repair fees

Focusing on reverse logistics, the activity that generates revenue effectively is through repair fees. This process entails taking returned products and restoring them to a sellable condition, allowing companies to recapture some of the value from returned items. By charging customers for repair services, businesses can directly generate income from activities that would otherwise result in a loss of revenue due to product returns. Repair tends to be a highly valuable process because it not only recoups some costs but also supports sustainability efforts by reducing waste and extending the lifespan of products. Organizations often leverage this to build customer loyalty and maintain relationships, as customers may appreciate the opportunity to repair instead of having to discard defective or unwanted products entirely. Thus, the generation of revenue through repair fees is significant in the context of reverse logistics.