10 Chapter4 PDF

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CHAPTER 4
ANALYSIS OF INFLUENCING FACTORS ON REVERSE

LOGISTICS IN INDUSTRIES
This chapter describes the analysis of the data collected from the
respondents from Manufacturing, Home Appliances and Process industries in
South India. A detailed discussion has been carried out to find the most
influencing factor of Reverse Logistics Services (RLS) and Return Polices
(RP) among these industries using Regression Analysis. Friedman test is used
to find out the most influencing sub factors among Information Technology
Enabled Services (ITES), Communication Techniques (CT) also termed as
Techniques and Reverse Logistics Operations (RLO) in these industries
handling reverse logistics. The details are provided under various sub
headings.
4.1 INFLUENCING FACTORS ON REVERSE LOGISTICS

MANAGEMENT
Reverse logistics management (RLM) facilitates the reuse of

redundant products from commercial returns and the excess inventory of
products and materials. It includes processing of returned products, restock,
recover, seasonal and excess inventory. It is associated with recycling
programs, hazardous material management programs, outdated equipment
disposition, and asset recovery. Regaining value, achieving a competitive
advantage and sustaining a better environment are the advantages of having
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good RLM system. The analysis was carried out in South Indian industries,
which involves various types of activities listed below.
• Vehicle, ships, aerospace and parts.
• Coal, petroleum, chemicals and allied products
• Stone, Clay, Glass, and Concrete Products
• Electrical, electronic products and parts.
• E-Business
• Pulp and paper industries.
• Home appliances.
• Refrigeration and Air conditioning products
Most of the South Indian industries using RLM are falling under
the following three major categories:
1. Industries carry out manufacturing activities (Manufacturing

Industries).
2. Industries involving in domestic appliances production and

distribution activities (Home Appliances Industries).
3. Industries involving process engineering (Process Industries).
The opinion of (Fleischmann et al. 1997; Rogers & Tibben-Lembke

1998) say who have been dealing with reverse logistics in manufacturing
industries for more than five years and these industries are more likely than
others to practice reverse logistics as part of their business processes. As per
the statement, amongst manufacturing, home appliances and process
industries, manufacturing industries require more reverse logistics setup than
others. To study on certain aspects of outsourcing and issues in employing
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Reverse Logistics Service Providers (RLSP) in these three categories in South

India, the postal questionnaire survey and direct questionnaire survey is used
to reach the randomly selected industries (Appendix 1). This research focuses
on the diverse concerns associated with RL commerce framework and model
that will be helpful to decision makers in the RL commerce. The work is
summarized below:
Before distributing the developed questionnaires among the South

Indian industries, size of sample must be defined. Determination of sample
size, when population size is not known can be carried on if population
proportion is equal (Susan Rose et al 2015) i.e., (0.5 known, 0.5 unknown).
The formula used for sample size determination is given in Equation (4.1).

n= (4.1)
where ‘z’ is the confidence level value at 95% = 1.96
‘e’ is the ‘margin of error’ also known as ‘distance of assurance’
‘p’ is the ‘known population proportion’ and
‘q’ is the ‘unknown population proportion’
If ‘p’ is unknown, substitute the maximum value of p = 0.5. z2 is

3.84 at 95% confidence level, so that sample size is calculated as 266.78.
Studies conducted by (Rogers & Tibben-Lembke 1998), showed that more
than 2/3 of Manufacturing companies use RLM as compared to Home
Appliances and Process industries. Therefore under this study the
questionnaires had been distributed to 266 industries covering all the three
category of industries. The Table 4.1 shows the distribution of questionnaires
and the number of questionnaires filtered based on the accuracy of the
respondent’s questionnaires.
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Table 4.1 Responses to the questionnaire for RLM
Category of Industry Questionnaire Questionnaire Questionnaire

Surveyed Distributed Received Filtered
Manufacturing
160 147 93
Industries
Home Appliances
53 43 33
Industries
Process Industries 53 47 30
The overall responses rate from this survey was 89%, which is
considered to be a good result based on the study conducted by (Collis &
Hussey 2003). From the review of literature RLS and RP is considered as two
major dependent factors influencing reverse logistics. So the above said
factors are considered as dependent variables for the study. This work tries to
find out the relationship between RLS, RP and the following independent
variables associated with RLS and RP. The analysis of this study covers the
following hypothesis in manufacturing, home appliances and process
industries.
4.1.1 Null Hypothesis
The following null hypotheses are framed for regression analysis:
1. The three independent variables ITES, RLO & CT equally

influence the dependent variable RLS in Manufacturing
Industries.

influence the dependent variable RP in Manufacturing
Industries
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influence the dependent variable RLS in Home Appliances
Industries

influence the dependent variable RP in Home Appliances
Industries

influence the dependent variable RLS in Process Industries

influence the dependent variable RP in Process Industries
The effect of these hypotheses on the above criteria has been

analyzed using Regression Analysis.
4.2 STUDIES ON INFLUENCING CRITERIA USING

REGRESSION ANALYSIS
Multi-linear regression analysis is a quantitative research method,

used in studies analyzing several variables, where the relationship includes a
dependent variable (Y) and independent variables (X1, X2, X3 …). It is a
linear approach used to measure the relationship between identified factors of
scalar dependent variable (RLS and RP) against independent variables (ITES,
CT and RLO). Initially the data were coded and recorded after removing the
incomplete ones. The data analysis is undertaken for manufacturing, home
appliances and process industries for all the dependent and independent
variables separately by Minitab. The analysis depicted in the succeeding sub-
division is clustered into initial results and reverse logistics concerns. The
‘null hypothesis’ affirms that the slope is evenly proportional to zero, and the
‘alternative hypothesis’ affirms that the slope is not evenly proportional to
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zero. The ‘p-value’ for every term tests the null hypothesis that the coefficient
is evenly proportional to zero (no effect). It is a number between 0 and 1. A
small p-value (typically < 0.05) signifies robust roof in opposition to the null
hypothesis, so that it can be rejected. Regression analysis (RA) has been
carried out for three categories of industries in two different cases as given
below.
RA(1) : Analysis of association between dependent variable (Y) and

independent variables (X1, X2, X3 …) in Manufacturing
Industries
Case (i) : Where dependent variable (Y) is RLS and independent variables
are ITES (X1), CT (X2) and RLO (X3).
Case (ii) : Where dependent variable (Y) is RP and independent variables


independent variables (X1, X2, X3 …) in Home Appliances
Industries


independent variables (X1, X2, X3 …) in Process Industries
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In all the above cases, all the three independent variables do not
equally influence the dependent variable. If the calculated value is > 0.05 (p
value or significant value), then accept null hypothesis and reject alternate
hypothesis. If the calculated value is < 0.05, reject null hypothesis and accept
alternate hypothesis.
The model summaries are shown in Table 4.3, Table 4.6 and Table
4.10. These tables display the R. R-Sq. R-Sq (adj) and standard error (S). R is
the correlation between the dependent and independent variables. The values
of R range from -1 to +1. The sign of R indicated the direction of relationship
(positive or negative).
4.2.1 Analysis of Relationship between Dependent and Independent

Variables in Manufacturing Industries – RA (1)
The linear regression analysis is carried out between RLS and

ITES, CT, RLO in case (i) & RP and ITES, CT, RLO in case (ii). The details
of regression analysis are summarized in Table 4.2.
Table 4.2 Model Summary for RA (1)
Case S R-Sq R-Sq (adj) R
Case (i) 0.0842669 0.8202 81.41 % 0.9056
Case (ii) 0.0661961 0.8972 89.37 % 0.9472

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In case (i), the multiple correlation coefficient (0.9056) evaluates

the level of association between the actual values and predicted values of the
effectiveness of RLS. Owing to the predicted values obtained as a linear
combination of ITES (X1), CT (X2) RLO (X3), the coefficient value (1.8465)
shows that the association between dependent variable (Y) and the three
independent variables are quite strong and positive.
In case (ii), the multiple correlation coefficient (0.9472) evaluates

effectiveness of RP. Owing to the predicted values obtained as a linear
combination of ITES (X1), CT (X2) RLO (X3), the coefficient value (1.6989)
shows that the association between dependent variable (Y) and the three
independent variables are quite strong and positive.
The R-square, which is referred to as the Coefficient of

Determination, evaluates the goodness-of-fit for the approximated sample
regression plane, i.e. SRP, from the perspective of variation in the dependent
variables described by the fitted sample regression expression. Therefore, in
case (i), the R-square’s value is 0.8202 and straightforward implies that 82.02
percent of the variation in RL is described by the SRP, which utilizes ITES,
CT and RLO in RL as independent variables and the value of R-square is
significant at 0.05 level.
In case (ii), the R-square value is 0.8972 that merely means that
89.72 percent of the variation in Return Policy is described through the SRP,
which utilizes ITES, CT and RLO in Return Policy as independent variables
while the value of R-square is significant at 0.05 level.
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Table 4.3 Analysis of Variance for RA (1): case (i)
Source DF Adj SS Adj Ms F Value P Value

Regression 3 2.85137 0.95046 133.85 0.000
ITES 1 1.53185 1.53185 215.73 0.000
Techniques 1 0.01244 0.01244 1.75 0.189
RLO 1 0.45888 0.45888 64.62 0.000
Error 88 0.62488 0.00710
Lack of Fit 69 0.45283 0.00656 0.72 0.834
Pure Error 19 0.17205 0.00906
Total 93 3.47625
In case (i), the R value is found to be 0.9056 and R-Square value is

0.8202. This indicated that there is positive association between RLS and the
independent variables. This means, if the value of independent variables
increases, then the value of RLS also increases. The F statistic is utilized to
test the significance of R-Square which is 133.85, and it is significant as the p
value is < 0.05. This indicates that 82.02 % of the variations in RLS are
explained by the three independent variables. If F statistic is significant, then
the independent variables explain the variation in the dependent variables.
Table 4.4 Analysis of Variance for RA (1): case (ii)

Regression 3 3.36724 1.12241 256.15 0.000
ITES 1 1.70962 1.70962 390.15 0.000
Techniques 1 0.01998 0.01998 4.56 0.035
RLO 1 0.59537 0.59537 135.87 0.000
Error 88 0.38561 0.00438
Lack of Fit 69 0.22745 0.00330 0.40 0.997
Pure Error 19 0.15816 0.00832
Total 93 3.75285
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In case (ii), the R value is found to be 0.9472 and R-Square value is

0.8972. This indicated that there is positive relationship between RP and the
increase, then the value of RP also increases. The F statistic used to test the
significance of R-Square which is 256.15, and it is significant as the p value is
<0.05. This indicates that 89.72 % of the variations in RP are explained by the
three independent variables. If F statistic is significant, then the independent
variables explain the variation in the dependent variables.
Table 4.5 Regression Coefficients for RA (1)

Coefficient
Coefficient
T-Value
P-Value
Term
Case
SE
Constant 1.8465 0.0938 19.68 0.000

Case (i)
Y=RLS
ITES (X1) 0.2730 0.0186 14.69 0.000

CT (X2) 0.0228 0.0172 1.32 0.189
RLO (X3) 0.1496 0.0186 8.04 0.000
Constant 1.6989 0.0737 23.05 0.000
Case (ii)
ITES (X1) 0.2884 0.0146 19.75 0.000

Y=RP
CT (X2) 0.0289 0.0135 2.14 0.035

RLO (X3) 0.1704 0.0146 11.66 0.000
For case (i), the estimated regression model is
Y 1.8465 0.2730 X 0.0228 X 0.1496 X (4.2)
Here, Y = RLS; X1 = ITES; X2 = Techniques; X3 = RLO

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From Table 4.3, it is clearly seen that the p values of ITES and
RLO are significant at 95% confidence level (<0.05), whereas the p value of
CT is insignificant. This means that ITES and RLO influence RLS in the
Manufacturing Industries. Since the coefficient value of ITES (0.2730) is
greater than the coefficient value of RLO (0.1496), it can be said that ITES is
the most influencing factors of RLS in the Manufacturing Industry. From the
Equation (4.2) it can be inferred that if ITES services increases by one unit,
then RLS will increase by 0.2730 units.
For case (ii), the estimated regression model is
Y 1.6986 0.2884 X 0.0289 X 0.1704 X (4.3)
Here, Y = RP; X1 = ITES; X2 = Techniques; X3 = RLO
From Table 4.4, it is clearly seen that the p values of ITES and
RLO are significant at 95% confidence level (<0.05), whereas the p value of
CT is also significant but little higher. This means that ITES and RLO
influence RP in the Manufacturing Industries. Since the coefficient value of
ITES (0.2884) is greater than the coefficient value RLO (0.1704), it can be
said that ITES is the most influencing factor of RP in the Manufacturing
Industry. From the Equation (4.3), it can be inferred that if ITES services
increases by one unit, then RP will increase by 0.2884 units. Both cases from
the Table 4.5, all the three independent variables do not equally influence the
dependent variable. If the calculated value is <0.05 reject null hypotheses and
accept alternate hypotheses. Hence the null hypotheses (1) and (2) are rejected
and alternate hypothesis are accepted. The details for linear regression for
case (i) and case (ii) is graphically represented in Figure 4.1 and Figure 4.2
for Manufacturing Industries.
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Residual Plots for RLS

Normal Probability Plot Versus Fits
99.9
99
0.2
90
Residual
Percent
0.0
50
10 -0.2
1
0.1 -0.4
-0.4 -0.2 0.0 0.2 3.00 3.25 3.50 3.75 4.00
Residual Fitted Value
Histogram Versus Order

30
0.2
Frequency
Residual
20 0.0
10 -0.2
0 -0.4
-0.3 -0.2 -0.1 0.0 0.1 0.2 1 10 20 30 40 50 60 70 80 90
Residual Observation Order
Figure 4.1 Analysis result of RLS versus independent variables of

Manufacturing Industries
Residual Plots for RP

99.9
99 0.2
90 0.1
Residual
Percent
50 0.0
10 -0.1
1
-0.2
0.1
-0.2 -0.1 0.0 0.1 0.2 3.00 3.25 3.50 3.75 4.00

30
0.2
F requency
0.1
Residual
20
0.0
10
-0.1
-0.2
0
-0.2 -0.1 0.0 0.1 0.2 1 10 20 30 40 50 60 70 80 90
Figure 4.2 Analysis result of RP versus independent variables of

Manufacturing Industries
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Variables in Home Appliance Industries – RA (2)


Case (i) 0.0854488 0.8629 84.87 % 0.9289
Case (ii) 0.0846320 0.8655 85.16 % 0.9303
In Case (i), the multiple correlation coefficient (0.9289) evaluates

effectiveness of RLS. Owing to the predicted values attained as a linear
combination of ITES (X1), CT (X2) and RLO (X3), the coefficient value
(1.386) reveals that the association between Reverse Logistics Services and
the three independent variables are quite strong and positive. In Case (ii), the
multiple correlation coefficient (0.9303) evaluates the level of association
between the actual values and predicted values of the effectiveness of RP.
Owing to the predicted values attained as a linear combination of ITES (X1),
CT (X2) and RLO (X3), the coefficient value (1.352) reveals that the
association between RP and the three independent variables are certainly
strong and positive.
The Coefficient of determination of R-square evaluates the

goodness of fit of the approximated sample regression plane (SRP) with
respect of the ratio of the variation in the dependent variables discussed by the
fitted sample regression equation. In case (i), the value of R square is 0.8629
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simply means that 86.29 percent of the variation in RLS is explained by the
SRP that uses ITES, CT and RLO in Reverse Logistics as independent
variables and the value of R-square is significant at 0.05 level. In case (ii), the
R-square’s value of 0.8655 simply means that 86.55 percent of the variation
in RP is explained by the SRP that uses ITES, CT and RLO in RP as
independent variables and the value of R-square is significant at 0.05 level.
Table 4.7 Analysis of Variance for RA (2): case (i)

Regression 3 1.33236 0.444119 60.83 0.000
ITES 1 0.01414 0.014142 1.94 0.175
Techniques 1 0.18177 0.181771 24.90 0.000
RLO 1 0.44506 0.445064 60.96 0.000
Error 29 0.21174 0.007302 - -
Lack of Fit 27 0.21162 0.007838 122.46 0.008
Pure Error 2 0.00013 0.000064
Total 33 1.54410
For case (i), the R value is found to be 0.9289 and the R-Square
value is 0.8629. This indicated that there is positive relationship between RLS
and independent variables. This means, if the independent variables increase,
then the value of RLS also increase. The F statistic is used to test the
significance of R-Square is 60.83 which is significant as the P value is smaller
than 0.05. This indicates that 86.29 % of the variations in RLS are explained
by the three independent variables.
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Regression 3 1.33639 0.445462 62.19 0.000
ITES 1 0.01817 0.018172 2.54 0.122
Techniques 1 0.18354 0.183536 25.62 0.000
RLO 1 0.44894 0.448940 62.68 0.000
Error 29 0.20771 0.007163 - -
Lack of Fit 27 0.20759 0.007688 120.13 0.008
Pure Error 2 0.00013 0.000064
Total 33 1.54410
For Case (ii), the R value is found to be 0.9303 and the R-
Square value is 0.8655. This indicated that there is positive relationship
between RP and the independent variables. This means, if the value of
independent variables increase, then value of RP also increase. The F statistic
is used to test the significance of R-Square is 62.19 which is significant as the
P value is smaller than 0.05. This indicates that 86.55 % of the variations in
RP are explained by the independent variables. In both cases, if F statistic is
significant, then the independent variables explain the variation in the
dependent variables.
Table 4.9 Regression co-efficient for RA (2)
SE T-
Case Term Coefficient P-Value
Coefficient Value
Constant 1.386 0.265 5.22 0.000
Case (i)
Y=RLS
ITES (X1) 0.0865 0.0621 1.39 0.175

CT (X2) 0.2103 0.0421 4.99 0.000
RLO (X3) 0.2776 0.0356 7.81 0.000
Constant 1.352 0.259 5.21 0.000
Case (ii)
Y=RP
ITES (X1) 0.0934 0.0586 1.59 0.122

CT (X2) 0.2114 0.0418 5.06 0.000
RLO (X3) 0.2795 0.0353 7.92 0.000
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For case (i), the estimated regression model is

Y 1.386 0.0865 X 0.2103 X 0.2776 X (4.4)
Here, Y = RLS; X1 = ITES; X2 = CT; X3 = RLO
From Table 4.7, it is clearly seen that the p-values of CT and RLO
are significant at 95% confidence level (<0.05), whereas the p value of ITES
is insignificant. This means that CT and RLO influence RLS in the Home
Appliances Industries. Since the coefficient value of RLO (0.2776) is greater
than the coefficient value of CT (0.2103), it can be said that RLO is the most
influencing factor of RLS in the Home Appliances Industries. From the
Equation (4.4) it can be inferred that if the value of RLO increases by one
unit, then the value of RLS will increase by 0.2776 units.
In case (ii), the estimated regression model is

Y 1.352 0.0934 X 0.2114 X 0.2795 X (4.5)
Here, Y = RP; X1 = ITES; X2 = CT; X3 = RLO
From Table 4.8, it is clearly seen that the P values of CT and RLO
are significant at 95% confidence level (<0.05), whereas the P value of ITES
is insignificant. This means that CT and RLO influence RP in the Home
Appliances Industries. Since the coefficient value of RLO (0.2795) is greater
than the coefficient value CT (0.2114), it can be said that RLO is the most
influencing factor of RP in the Home Appliances Industries. From the
Equation (4.5) it can be inferred that if the value of RLO increases by 1unit,
then the value of RP will increase by 0.2795 units.
Both cases from the Table 4.9, all the three independent variables
do not equally influence the dependent variable. If the calculated value is
<0.05 reject null hypotheses and accept alternate hypotheses. Hence the null
hypotheses (3) and (4) are rejected and alternate hypothesis are accepted.
The details of linear regression for case (i) and case (ii) is graphically
represented in Figure 4.3 and Figure 4.4 for Home Appliances Industries.
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Residual Plots for RLS

99
0.1
90
Residual
Percent
50 0.0
10 -0.1
1
-0.2 -0.1 0.0 0.1 0.2 3.2 3.4 3.6 3.8

8
0.1
6
F requency
Residual
4 0.0
2 -0.1
0
-0.16 -0.12 -0.08 -0.04 0.00 0.04 0.08 0.12 1 5 10 15 20 25 30
Figure 4.3 Analysis result of RLS versus independent variables of

Home Appliances Industries

99
0.1
90
Residual
Percent
50 0.0
10 -0.1
1
-0.2 -0.1 0.0 0.1 0.2 3.2 3.4 3.6 3.8

8
0.1
6
F requency
Residual
4 0.0
2 -0.1
0
-0.16 -0.12 -0.08 -0.04 0.00 0.04 0.08 0.12 1 5 10 15 20 25 30
Figure 4.4 Analysis result of RP versus independent variables of Home

Appliances Industries
45

Variables in Process Industries – RA (3)


Case (i) 0.0203159 0.9573 95.23% 0.9784
Case (ii) 0.0307885 0.8979 88.61 % 0.9475
In case (i), the multiple correlation coefficient (0.9784) measures

the degree of relationship between the actual values and predicted values of
the effectiveness of RLS. Owing to the predicted values attained as a linear
combination of ITES (X1), CT (X2) and RLO (X3), the coefficient value
(2.3890) shows the association between RLS and the three independent
variables are certainly strong and positive. In Case (ii), the multiple
correlation coefficient (0.9475) measures the degree of relationship between
the actual values and predicted values of the effectiveness of RP. Because of
the predicted values are obtained as a linear combination of ITES (X1), CT
(X2) and RLO (X3), the coefficient value (2.4320) shows the association
between RP and the three independent variables are certainly strong and
positive.
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Table 4.11 Analysis of Variance of RA (3): case (i)

Regression 3 0.240365 0.080122 194.12 0.000
ITES 1 0.001583 0.001583 3.84 0.061
Techniques 1 0.035167 0.035167 85.21 0.000
RLO 1 0.039486 0.039486 95.67 0.000
Error 26 0.010731 0.000413 - -
Lack of Fit 24 0.010728 0.000447 335.76 0.003
Pure Error 2 0.000003 0.000001
Total 30 0.251096
In both cases, the Coefficient of determination being R-square,

evaluates the goodness-of-fit of the approximated sample regression plane
(SRP) from the perspective of the ratio of the variation in the dependent
variables discussed through the fitted sample regression expression. In case (i),
the R-square’s value is 0.9573, and merely indicates that 95.73 percent of the
variation in Reverse Logistics Services (RLS) is explained by the SRP that uses
ITES, CT and RLO in RLS as independent variables and R-square value is
significant at 0.05 level. In case (ii), the value of R-square is 0.8979 merely
indicates that 89.79 percent of the variation in RP is explained by the SRP that
uses ITES, CT and RLO in RP as independent variables and R-square value is
significant at 0.05 level.
In case (i), the R value is found to be 0.9784 and R-Square value is

0.9573. This indicated that there is positive relationship between RLS and the
increase, then the value of RLS also increase. The F statistic used to test the
significance of R-Square which is 194.12, and it is significant as the p-value
is <0.05. This indicates that 95.73 % of the variations in RLS are explained by
47
the three independent variables. If F statistic is significant, then the

independent variables explain the variation in the dependent variables.
Regression 3 0.216792 0.072264 76.23 0.000
ITES 1 0.002211 0.002211 2.33 0.139
Techniques 1 0.036143 0.036143 38.13 0.000
RLO 1 0.029248 0.029248 30.85 0.000
Error 26 0.024646 0.000948
Lack of Fit 24 0.022194 0.000925 0.75 0.716
Pure Error 2 0.002453 0.001226
Total 30 0.241438
In case (ii), the R value is found to be 0.9475 and R-Square value is

0.8979. This indicated that there is positive association between RP and the
increase, then the value of RP also increase. The F statistic used to test the
significance of R-Square which is 76.23, and it is significant as the p-value is
<0.05. This indicates that 89.79 % of the variations in RP are explained by the
three independent variables. If F statistic is significant, then the independent
variables explain the variation in the dependent variables.
48
Table 4.13 Regression Coefficients for RA (3)
SE Coefficient
Coefficient
T-Value
P-Value
Term
Case
Constant 2.3890 0.0523 45.64 0.000

Case (i)
Y=RLS
ITES (X1) 0.0184 0.0094 1.96 0.061

CT (X2) 0.1624 0.0176 9.23 0.000
RLO (X3) 0.1144 0.0117 9.78 0.000
Constant 2.4320 0.0793 30.66 0.000
Case (ii)
ITES (X1) 0.0218 0.0143 1.53 0.139

Y=RP
CT (X2) 0.1647 0.0267 6.17 0.000

RLO (X3) 0.0985 0.0177 5.55 0.000
For Case (i), the estimated regression model is
Y 2.3890 0.0184 X 0.1624 X 0.1144 X (4.6)
Here, Y = RLS; X1 = ITES; X2 = CT; X3 = RLO
From Table 4.11, it is clearly seen that the p-values of CT and RLO
are significant at 95% confidence level (<0.05), where as the p-value of ITES
is insignificant. This means that CT and RLO influence RLS in the Process
Industries. Since the coefficient value of CT (0.1624) is greater than the
coefficient value of RLO (0.1144), it can be said that CT is the most
influencing factor of RLS in the Process Industries.
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From the Equation (4.6) it can be inferred that if the value of CT

increases by one unit, then the value of RLS will increase by 0.1624 units.
In Case (ii), the estimated regression model is
Y 2.4320 0.0218 X 0.1647 X 0.0985 X (4.7)
Here, Y = RP; X1 = ITES; X2 = CT; X3 = RLO
From Table 4.12, it is clearly seen that the p values of CT and RLO
are significant at 95% confidence level (<0.05), whereas the P value of ITES
is insignificant. This means that CT and RLO influence RP in the Process
Industries. Since the coefficient value of CT (0.1647) is greater than the
coefficient value RLO (0.0985), it can be said that CT is the most influencing
factor of RP in the Process Industries. From the Equation (4.7) it can be
inferred that if the value of CT increases by one unit, then RP will increase by
0.1647 units.
Both cases from the Table 4.13, all the three independent variables
do not equally influence the dependent variable. If the calculated value is
<0.05 reject null hypotheses and accept alternate hypotheses. Hence the null
hypotheses (5) and (6) are rejected and alternate hypothesis are accepted.
The details of linear regression for case (i) and case (ii) is
graphically represented in Figure 4.5 and Figure 4.6
Figure 4.5 and 4.6 show the analysis result of Process Industries.
50

99 0.04
90
0.02
Residual
Percent
50 0.00
10 -0.02
1 -0.04
-0.050 -0.025 0.000 0.025 0.050 3.4 3.5 3.6 3.7

0.04
8
0.02
F requency
Residual
6
0.00
4
-0.02
2
0 -0.04
-0.04 -0.02 0.00 0.02 0.04 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30
Figure 4.5 Analysis results of RLS versus independent variables of

Process Industries

99
0.05
90
Residual
Percent
0.00
50
-0.05
10
1 -0.10
-0.10 -0.05 0.00 0.05 3.4 3.5 3.6 3.7
10.0 0.05
F requency
Residual
7.5
0.00
5.0
-0.05
2.5
0.0 -0.10
-0.08 -0.06 -0.04 -0.02 0.00 0.02 0.04 0.06 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30
Figure 4.6 Analysis results of RP versus independent variables of

Process Industries
51
4.3 FRIEDMAN’S TEST ANALYSIS
In order to identify the sub factor which is highly influential among

ITES in Manufacturing Industries, RLO in Home Appliances Industries and
CT in Process Industries, the Friedman’s test analysis were conducted. The
Friedman test is the non-parametric alternative used to test the differences
between groups, when the dependent variable being measured is ordinal. It
can be used for continuous data that has been marked deviations from
normality. The Friedman test demands the data to satisfy the following
assumptions.
• One unit that is calculated on three or more different

circumstances.
• The unit is a random sample from the population.
• Dependent variable should be calculated on the ordinal or

continuous level.
• Samples may not be normally distributed.
Identification of highly influencing sub factor in Manufacturing,

Home Appliances and Process Industries are given below.
From Friedman’s test statistics (Source: Computed Data) of ITES

in Manufacturing Industries, the following observations are noted.
N value is 93
Chi-Square (Friedman’s Q) is 104.289
Degrees of freedom (df) is 6
Significance level is 0.000

52
It could be noted from the above observation that among the seven
sub factors of ITES, “Customer Order Management System” was ranked first.
It is followed by the “Supplier Management System”, and “Web Enabled
Communication System” was ranked third. The least important variable is
“The Bar Coding / RFID System”. The test-statistic, Friedman Q is like a
variance over the mean ranks: it’s 0 when the mean ranks are exactly equal
and becomes larger as they lie further apart. From table 4.14, the Friedman
test indicates that the ITES variables are rated differently, since the Friedman
Q value is 104.289 and it is highly significant (p = 0.000). Ranking of ITES,
RLO and CT variables are shown in Figures 4.7, 4.8 and 4.9.
Table 4.14 Frequency Distribution of ITES Variables (sub factors)

Important
Important
Important
Important
Important
Offered
Fairly
Least
Most
Very
Not
Variables of ITES
Export / Import
28 6 8 13 17 21
Management System
Warehouse Distribution
14 11 6 30 22 10
System
Web Enabled
16 8 7 15 18 29
Communication System
Transportation Management
10 8 5 22 28 20
System
Supplier Management
2 12 9 14 34 22
System
Customer Order
5 6 9 13 28 32
Management System
Bar Coding/RFID System 27 16 15 14 9 12

53
4.93 Mean Rank

4.75 4.33 4.32
3.54 3.48
2.64
Management System
Management System
Management System
Bar Coding/RFID
Warehouse Distribution
Supplier Management
Communication System
Customer Order
Export / Import
Transportation
Web Enabled
System
System
System
1 2 3 4 5 6 7
Figure 4.7 Ranking of ITES Variables
From Friedman’s test statistics (Source: Computed Data) of RLO in

Home Appliances Industries, the following observations are noted.
N value is 33
It could be noted from the above observation that among the fifteen
sub factors of RLO, “Communication’’ was ranked first. It is followed by the
“Customer Relationship Management” and “Information Management” was
ranked third. The least important variable is “Incineration / Landfill”. The test-
statistic, Friedman Q is like a variance over the mean ranks: it’s 0 when the mean
ranks are exactly equal and becomes larger as they lie further apart. From table
4.15 the Friedman test indicates that the RLO variables are rated differently,
since the Friedman Q value is 148.103 and it is highly significant (p = 0.000).
54
Table 4.15 Frequency Distribution of RLO Variables (sub factors)
No Impact
Extremely
Extremely
High
High
Low
Low
Variables of RLO
Communication 0 3 0 10 20
Information Management 1 6 0 8 18
Customer Relationship
0 3 7 7 16
Management
Inventory Management -
6 10 4 3 10
Returned Goods Related
Redelivering to Customer /
8 7 4 6 8
Marker
Return Authorization /
8 4 5 5 11
Gate Keeping
Collecting & Delivering
15 1 2 12 3
Returned Goods to Factory
Inspect/ Examine/ Select/
6 10 7 2 8
Sort Returns to Responses
Resale/Redistribution of
5 5 11 9 3
Returns
Reuse of Returns 9 11 7 6 0
Donation of Returns 17 7 4 4 1
Repair / Upgrade of
6 8 14 2 3
Returns
Component / Part / Module
4 23 2 1 3
- Recovering
Recycling 12 14 3 1 3
Incineration / Landfill 21 4 3 5 0
Process Industries, the following observations are noted.
12.71
Communication
11.7611.38
Customer Relationship Management
2
N value is 30
From Friedman’s test statistics (Source: Computed Data) of CT in

Information Management
8.5 8.45 8.3

Return Authorization / Gate Keeping
4
Figure 4.8 Ranking of RLO Variables
Inventory Management - Returned…
5
Resale/Redistribution of Returns
7.95 7.73 7.68

Redelivering to Customer / Marker
7
Inspect/ Examine/ Select/ Sort…
8
Repair / Upgrade of Returns
9
6.7 6.52 6.44

10
Reuse of Returns
Mean Rank
11
Component / Part / Module -…

12
Collecting & Delivering Returned…
5.82 5.55
13
Donation of Returns
14
Recycling
4.52
15
Incineration / Landfill
55
56
It could be noted from the above observation that among the eleven
sub factors of CT, “Computers / Desktop / Laptop” was ranked first. It is
followed by the “Landline / Telephone / Fax” and “Internet’’ was ranked
third. The least important variable is “Electronic Data Interchange”.
The test-statistic, Friedman Q is like a variance over the mean

ranks: it’s 0 when the mean ranks are exactly equal and becomes larger as
they lie further apart. From table 4.16 the Friedman test indicates that the
technology variables (CT) are rated differently, since the Friedman Q value is
53.765 and it is highly significant (p = 0.000).
Table 4.16 Frequency Distribution of CT Variables (sub factors)
Extremely Low High Extremely

Variables of CT Use
Low Use Use Use High Use
Landline Telephone / Fax 0 0 5 12 13
Computers / Desktop
0 0 3 4 23
Laptop
Electronic Data
11 5 1 9 4
Interchange - EDI
Barcode Technology 13 0 0 8 9
Decision Support System 5 4 6 9 6
Data Logging 9 3 2 10 6
Track & Tracing
6 3 8 5 8
Technological Systems
Global Positioning
Systems / Geographical 7 5 2 7 9
Information System
Entrepreneurship Resource
3 0 10 10 7
Planning
Intranet 6 3 10 9 2
Internet 0 2 9 8 11
57
9
Mean Rank
7.05 6.75
5.98 5.88 5.87 5.85
5.47 5.25
4.6 4.3
LandLine Telephone / Fax
Data Logging
Barcode Technology
Track & Tracing Technological
Geographical Information System
Decision Support System

Entrepreneurship Resource
Electronic Data Interchange - EDI

Computers / Desktop Laptop
Internet
Intranet
Global Positioning Systems /
Planning
Systems
1 2 3 4 5 6 7 8 9 10 11
Figure 4.9 Ranking of CT Variables
4.4 RESULTS AND DISCUSSIONS
4.4.1 Manufacturing Industries
From the analysis of Manufacturing Industries, it is concluded that

the independent variable ITES (0.2730) is the predominant factor which is
highly influencing the dependent variable RLS. It is followed by the next
dominant factor RLO (0.1496) which influences RLS. From the results
obtained, it can be concluded that if ITES services offered by Manufacturing
Industries increases by one unit then RLS increases by 0.2730 units. So the
58
alternate hypothesis is accepted. From the analysis of Manufacturing

Industries it is concluded that the independent variable ITES (0.2884) is the
predominant factor which is highly influencing the dependent variable RP. It
is followed by the next dominant factor RLO (0.1704) which influences RP.
From the results obtained, it can be concluded that if ITES services offered by
Manufacturing Industries increases by one unit then RP increases by 0.2884
units. So the alternate hypothesis is accepted.
It is concluded that ITES is the predominant factor influencing both

RLS and RP in Manufacturing Industries. The ITES is formulated with seven
sub factors. From the Friedman’s test statistics of ITES, the sub factor -
Customer Order Management System was ranked first as it highly influences
ITES. It is followed by the sub factor Supplier Management System and Web
Enabled Communication System respectively.
4.4.2 Home Appliances Industries
From the analysis in Home Appliances Industries, it is concluded that the

independent variable RLO (0.2776) is the predominant factor which is highly
influencing the dependent variable RLS. It is followed by the next dominant
factor CT (0.2103) which influences RLS. From the results obtained, it can be
concluded that if RLO services offered by Home Appliances Industries
increases by one unit then RLS increases by 0.2776 units. So the alternate
hypothesis is accepted.
From the analysis in Home Appliances Industries, it is concluded

that the independent variable RLO (0.2795) is the predominant factor which is
highly influencing the dependent variable RP. It is followed by the next
dominant factor CT (0.2114) which influences RP. From the results obtained,
it can be concluded that if RLO services offered by Home Appliances
Industries increases by one unit then RP increases by 0.2795 units. So the
59
alternate hypothesis is accepted. It is concluded that RLO is the predominant

factor influencing both RLS and RP in Home Appliances Industries. The RLO
is formulated with fifteen sub factors. From the Friedman’s test statistics of
RLO, the sub factor - Communication was ranked first as it highly influences
RLO. It is followed by the sub factor Customer Relationship Management and
Information Management respectively.
4.4.3 Process Industries
From the analysis in Process Industries, it is concluded that the

independent variable CT (0.1624) is the predominant factor which is highly
influencing the dependent variable RLS. It is followed by the next dominant
factor RLO (0.1144) which influences RLS. From the results obtained, it can
be concluded that if CT services offered by Process Industries increases by
one unit then RLS increases by 0.1624 units. So the alternate hypothesis is
accepted.
From the analysis in Process Industries, it is concluded that the

independent variable CT (0.1647) is the predominant factor which is highly
influencing the dependent variable RP. It is followed by the next dominant
factor RLO (0.0985) which influences RP. From the results obtained, it can be
concluded that if CT services offered by Process Industries increases by one
unit then RP increases by 0.1647 units. So the alternate hypothesis is
accepted.
It is concluded that CT is the predominant factor influencing both

RLS and RP in Process Industries. The CT is formulated with eleven sub
factors. From the Friedman’s test statistics of CT, the sub factor – Computer /
Desktop Laptop ranked first as it highly influences CT. It is followed by the
sub factor Landline / Telephone / Fax and Internet respectively.

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28

ANALYSIS OF INFLUENCING FACTORS ON REVERSE

4.1 INFLUENCING FACTORS ON REVERSE LOGISTICS

Reverse logistics management (RLM) facilitates the reuse of

• Vehicle, ships, aerospace and parts.

• Coal, petroleum, chemicals and allied products

• Stone, Clay, Glass, and Concrete Products

• Electrical, electronic products and parts.

• Pulp and paper industries.

• Refrigeration and Air conditioning products

1. Industries carry out manufacturing activities (Manufacturing

2. Industries involving in domestic appliances production and

3. Industries involving process engineering (Process Industries).

The opinion of (Fleischmann et al. 1997; Rogers & Tibben-Lembke

Reverse Logistics Service Providers (RLSP) in these three categories in South

Before distributing the developed questionnaires among the South

where ‘z’ is the confidence level value at 95% = 1.96

‘e’ is the ‘margin of error’ also known as ‘distance of assurance’

‘p’ is the ‘known population proportion’ and

‘q’ is the ‘unknown population proportion’

If ‘p’ is unknown, substitute the maximum value of p = 0.5. z2 is

Table 4.1 Responses to the questionnaire for RLM

Category of Industry Questionnaire Questionnaire Questionnaire

4.1.1 Null Hypothesis

The following null hypotheses are framed for regression analysis:

1. The three independent variables ITES, RLO & CT equally

2. The three independent variables ITES, RLO & CT equally

3. The three independent variables ITES, RLO & CT equally

4. The three independent variables ITES, RLO & CT equally

5. The three independent variables ITES, RLO & CT equally

6. The three independent variables ITES, RLO & CT equally

The effect of these hypotheses on the above criteria has been

4.2 STUDIES ON INFLUENCING CRITERIA USING

Multi-linear regression analysis is a quantitative research method,

RA(1) : Analysis of association between dependent variable (Y) and

Case (ii) : Where dependent variable (Y) is RP and independent variables

RA(2) : Analysis of association between dependent variable (Y) and

Case (ii) : Where dependent variable (Y) is RP and independent variables

RA(3) : Analysis of association between dependent variable (Y) and

Case (ii) : Where dependent variable (Y) is RP and independent variables

4.2.1 Analysis of Relationship between Dependent and Independent

The linear regression analysis is carried out between RLS and

Table 4.2 Model Summary for RA (1)

Case S R-Sq R-Sq (adj) R

Case (i) 0.0842669 0.8202 81.41 % 0.9056

Case (ii) 0.0661961 0.8972 89.37 % 0.9472

In case (i), the multiple correlation coefficient (0.9056) evaluates

In case (ii), the multiple correlation coefficient (0.9472) evaluates

The R-square, which is referred to as the Coefficient of

Table 4.3 Analysis of Variance for RA (1): case (i)

Source DF Adj SS Adj Ms F Value P Value

In case (i), the R value is found to be 0.9056 and R-Square value is

Table 4.4 Analysis of Variance for RA (1): case (ii)

In case (ii), the R value is found to be 0.9472 and R-Square value is

Table 4.5 Regression Coefficients for RA (1)

Constant 1.8465 0.0938 19.68 0.000

ITES (X1) 0.2730 0.0186 14.69 0.000

ITES (X1) 0.2884 0.0146 19.75 0.000

CT (X2) 0.0289 0.0135 2.14 0.035

For case (i), the estimated regression model is

Y 1.8465 0.2730 X 0.0228 X 0.1496 X (4.2)

Here, Y = RLS; X1 = ITES; X2 = Techniques; X3 = RLO