Reverse logistics capabilities and supply chain performance in a developingcountry context

Abstract

Today and in the highly complex pharmaceutical industry, reverse logistics is a core capabilityfor pharma companies that seek competitive advantages from the efficient management ofreturns and recalls, e.g. due to errors, expired stocks, quality-related or environmental issues,non-compliance and other consumer-related concerns. And yet in many developing countrieswhere the pharma industry is a big part of the economy, the value of RL is not well understood.In this study, we examine the ambivalent impact of reverse logistics capabilities within thepharmaceutical supply chains in a developing country by focusing on four key reverse logisticscapabilities, i.e. logistics information systems, process formalisation, flexibility, and top man-agement support. The findings show that logistics information management systems, processformalisation, and flexibility significantly affect supply chain performance of pharmaceuticalfirms. However, the hierarchical regression found no significant moderating effect of topmanagement support between reverse logistics capabilities and supply chain performance.Our subsequent discussion and implications for practice and future research are based onthese findings.