Reverse logistics has been undercover for years, often with no formal leadership within a brand or retailer’s organization.
But conditions are ripe for this part of the industry to step into the light, and not just as a participant. With a shaky economy, changing consumer preferences, increasing regulatory demands and the inherent challenges and costs involved with e-commerce returns, reverse logistics is moving from afterthought into one of the most consequential frontiers in the retail supply chain.
“Reverse logistics has suddenly become the center of the sustainability community and absolutely the backbone of the circular economy,” said National Retail Federation Vice President of Corporate Social Responsibility Scott Case in a Supply Chain Now conversation last month with host Scott W. Luton, Circular Chain Network founder Deborah Dull and Reverse Logistics Association Executive Director Tony Sciarrotta.
Small Items, Big Impact
The global secondhand apparel market is set to hit $3 billion by 2029, growing twice as fast as the overall apparel market, according to ThredUp’s 2026 Recommerce Report. With thrifting cool again, resellers are flocking to buy Goodwill merchandise by the pound.
And the consumer sentiment driving secondhand is not just impacting apparel. Shoppers are even open to buying used in product categories that might have seemed odd in the past. Dutch electronics giant Phillips took home three Clio awards last year for its “Better Than New” campaign marketing used electric toothbrushes, shavers and other products across Europe.
“That may be scary to some people, but let’s turn a light on,” Dull said, pointing to the common fork at a restaurant as the ultimate refurbished item no one thinks to question.
“[That’s] a celebration of how far our industry has come. The fact that we can sell an electric toothbrush again and make money is a huge deal.”
The pandemic-era rise of e-commerce was like jet fuel for reverse logistics as returns volumes surged and the costs of dealing with them multiplied. A weakening economy and tariff fall-out have also focused new attention on the resale and thrift movements as consumers and businesses look more closely at their bottom lines. And despite a strong anti-ESG political current in the U.S., Dull estimates upwards of 85% of companies are investing more into sustainability initiatives this year than in 2025.
“One way to avoid those tariffs is to source your items from within the country, and if you can resell it as it is, great,” she said. “If you can recondition it and put a little bit of work in, change that part and resell it, fantastic. It’s a faster experience. We have better tabs on it. And we’re supporting American businesses.”
Smooth returns and turning one person’s trash into another’s treasure can translate into lifelong customers. Plus, it turns out that doing good is also good for company profits. The global reverse logistics market is expected to reach $1.2B by 2033, offering operating margins of 15–25%, compared to 2–8% for traditional logistics.
“This whole reverse logistics ecosystem is finding ways to squeeze costs out of the system and, more importantly, find additional value,” Case said. “It’s no longer just a pure cost, it’s actually potential new revenue streams.”
From Linear Chain to Circular Web
Yet the circular economy is not straightforward.
Case pointed to a network of interdependent components from resale, repair and refurbishment to recycling and donation that only function when considered together. It can also be difficult for traditional supply chain players to wrap their heads around the idea that value is not created solely at the point of sale, but across the entire lifecycle of a product.
For starters, reverse logistics involves roughly seven times the touchpoints as the forward supply chain, Sciarrotta said. But leaning into complexity offers opportunities to recover value, reduce waste and improve customer outcomes.
On the macro level, “it’s no longer just throw it away into the landfill,” he added. “It’s find more things to do with it.”
The focus now is on bringing traditionally siloed operations together, including manufacturers, retailers, repair networks and resale platforms, into an integrated system that operates as a whole instead of the sum of its parts. That integration is where the next phase of value creation will occur, and it is beginning to take shape with a practice Dull called “urban mining.”
Instead of extracting raw materials from the earth, companies are maximizing value out of products already in circulation. A dropped-off sweater, a traded-in phone or a returned garment are not waste streams, but resources to tap.
Retailers once gave the practice a chilly reception, particularly on the luxury end, fearing it would harm their reputations.
“But the ship has sailed,” Dull said. “Resale is happening, and so now it becomes how do you want to participate to take a piece of the experience that your customer is having?”
Urban mining offers a competitive advantage and a new revenue stream, she said. The speed of the system is accelerating, with some pre-owned goods processed and resold within 48 hours – a turnover rate that would be impressive in any forward supply chain.
What’s more, customers are not only demanding the option of gently-used or refurbished products, they are actively purchasing clothing items with resale value in mind, participating in trade-in programs and making purchasing decisions based on a product’s second life.
For younger buyers in particular, Dull said the question isn’t “Do I want this?” but “What will this be worth later?” This behavior turns the traditional sales funnel into a loop, where the end of one transaction becomes the beginning of another.
“It’s been reported that some of the thrift stores are doing more growth business in the last year than the primary retailers, and that’s exciting,” Sciarrotta said. “That means people are noticing that there’s opportunities in vintage clothing, in pre-owned and certified electronics, and it’s fantastic.”
Busting Down the Doors of the Speakeasy
Despite new interest in the circular ecosystem, an information gap still exists, Sciarrotta said, adding that reverse logistics are largely invisible in corporate financial statements and organizational charts. Few companies have vice presidents of returns and even fewer have coherent reverse logistics strategies.
“We make lots of jokes about being the dark side,” he said.
For Dull, the space is more like a speakeasy: hard to find, populated by insiders, but full of energy inside. The trick is throwing open the doors and helping the broader industry understand fragmented systems, ad hoc processes and informal networks that don’t appear in traditional supply chain playbooks.
“Nobody plans to be in this space,” she said. “But once you get bit by the bug, you don’t leave, because here comes all of our favorite parts of the supply chain in this little area tucked in the corner.”
Dull is doing her part to let the world in, launching a Serial-style podcast tracing the circuitous circularity chain and pitching its merits. Meanwhile, the NRF bringing the Reverse Logistics Association under its umbrella late last year – and events like NRF Rev happening in tandem with the organization’s Big Show – is giving its practitioners a megaphone.
“Suddenly, the National Retail Federation, representing 5 million businesses in the United States is talking about returns, so the rest of the world is going to start talking about returns, the retailers and the manufacturers,” Sciarrotta said. “Now you’ve got this giant voice yelling it from the top of the ladder.”
Getting loud is critical because the problems reverse logistics must solve are too large and too interconnected for its small community to handle. Legal, finance, marketing, forward supply chain and sustainability teams all have a stake in how products move after sale.
As of now, the industry has few formal training programs and “barely one textbook,” according to Dull. That’s a challenge and an opportunity for new models, technologies and ways of thinking about product lifecycles.
What is clear is reverse logistics is no longer a niche concern, but a system under intense construction. It needs all hands on deck, Case said, adding it’s time to open the speakeasy to everyone.
“Bang open the door,” he said. “Everybody is invited. It’s a big disco party. Everybody can have fun and find your way to contribute to the bigger whole. And make money doing it.”
