Reverse operations just got a nudge forward for retailers. If you manage a retail operation, you are confronted with waste and hazardous materials problems that can be confusing for even the most seasoned manager. The U.S. Department of Transportation (DOT) recently finalized efforts to make reverse logistics easier for retailers that have to ship hazardous materials. Today we will give an overview of the new reverse logistics rule, and tomorrow we will go into some specific requirements.
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Three Caveats
It is critical to note that the new regulation applies only to highway transportation and does not apply to hazardous waste. It also does not apply to hazardous materials that are transported according to the provisions of a special permit.
What Are Reverse Logistics?
Reverse logistics involves the transportation of hazardous materials that have been damaged or returned by the retailer to a return center. DOT’s Pipeline and Hazardous Materials Safety Administration’s (PHMSA) new rule provides a regulatory definition of “reverse logistics” and outlines the responsibilities of those that offer management of hazardous materials returned by retail customers.
Who’s Affected?
The new regulation, found at 49 CFR 173.157, primarily affects retail outlets that in the past bore the full burden of the hazardous materials regulations (HMRs) even though reverse logistics shipments of certain materials presented a low risk. The new regulation addresses hazardous materials intended to be returned by a retailer to a supplier, distributor, or manufacturer.
The primary regulatory concern has been that retail outlets are ill-equipped to meet the HMRs in such areas as classification, selecting packaging, communicating hazards, and training employees in the functions they perform.
The final rule identifies the hazardous materials authorized, packaging, hazard communication, and training requirements for reverse logistics shipments. In addition to providing a new reverse logistics exception, the rule is also expands an existing exception for reverse logistics shipments of used automobile batteries that are being shipped from a retail facility to a recycling center.
According to PHMSA, the regulation is meant to ensure that retailers properly identify hazardous materials in the reverse logistics chain and to make sure that retailers’ employees have clear instructions to safely offer such shipments.
Note. Since the new rule is less strict than the applicable HMRs, it is optional. Retailers can choose to continue to operate under the full requirements of the HMRs. The reverse logistics rule is meant to provide some flexibility for retailers. According to PHMSA, the rule will not impose increased compliance costs and will in fact reduce compliance costs for those who take advantage of the alternative.
How Much Savings?
PHMSA claims the new rule will save the industry millions annually in reduced compliance costs. The biggest savings will be in training. Here’s how PHMSA breaks it down:
| Category | Amount of annual savings |
| Training | $4 million–$8 million |
| Shipping preparation | $0–$1 million |
| Transportation costs for battery recycling | $1 million–$2 million |
Retailers should see a reduction in shipping preparation costs involving certain quantities of consumer-type hazardous materials. There are marking requirements, but the vehicles carrying the packages do not require placarding. The new training requirements are meant to reflect the distinct segment of the supply chain that transports these consumer commodity hazardous materials in limited quantities as return shipments from retail stores. The new rule should also reduce the transportation costs involved in shipments for the recycling of lead-acid batteries (a.k.a., wet batteries).
Tune in tomorrow for the specifics of what is expected of retailers who choose to avail themselves of the reverse logistics rule flexibility.