Modern Data Platform vs. Traditional Data Platform: Where to invest your time and money?

Affine’s Analytics Engineering Practices releases Episode 3rd of Modern Data Platform, unbinding muddles between traditional and modern data platforms.

We explored data-driven strategy and the characteristics of modern enterprises in previous episodes of the Modern Data Platform series. Let’s take a closer look at some contemporary data-driven difficulties and see how traditional and modern techniques compared.

What are the bottlenecks of Traditional Data Platform?

Traditional data platforms fall behind the cloud on various factors. Organizations traditionally relied on in-house infrastructure to drive innovation and manage their workflow. Businesses would manage their in-house infrastructure and be accountable for everything, following traditional data platforms. The administration was taken care of by the in-house IT professionals. It was the business’s responsibility for downtime and repairs. We can say that managing the traditional data platform used to be an expensive affair.

Businesses had to take various responsibilities, like planning, people, hardware, software, and the environment. From a scalability perspective, it was possible, but it comes with the price of various challenges and delays hindering the performance of the enterprise’s overall data management.

Fig. 1: Illustrating the disadvantages of traditional data platform

Why should you consider cloud as a substitute option for Traditional Data Platform?

For instance, the traditional methods are still working effectively for many businesses, with a certain level of complications and challenges. Perhaps, the effectiveness gradually decreases as the business landscape changes with technology disruption.  The modern approach (cloud data platform) has a unique pace and benefits that can accommodate many inconsistencies at a time. The significant differences between the traditional and modern data platforms are highlighted in the table below:

How can Cloud Solutions boost your Modern Data Platform (MDP) Journey?

The cloud data platform is easing the use of data and securing it for every business. It provides various components and services like databases, software capabilities, applications, etc., that are engineered to leverage the power of cloud resources to decipher business problems. What are the benefits that businesses can achieve using Modern Data Platforms?  There are numerous benefits of MDP. Quicker time to develop and storage cost are a couple of crucial factors. Let’s take a look at other factors that comes into consideration.


It allows users to rent virtual computers to run their applications. IaaS has infrastructure and hardware running in the cloud. PaaS has application platforms and databases in the cloud. Containers are isolated environments for running software, and serverless functions compute services to run code in response to events.


A database service built and accessible through the cloud platform. It hosts databases without having to buy dedicated hardware. It can be managed by the user or as a service operated by a service provider. It can support relational and NoSQL databases. The database can be accessed from- anywhere through a web interface or an API.


It allows users to store and access data over a network, typically the internet. The cloud data platform offers flexible, pay-as-you-go pricing. Scalable up/down in near real-time. It supports backup, disaster recovery, collaboration/file sharing, archiving, primary data storage, and near-line storage.


Clients seek services that isolate resources, protect internet-facing workloads, and encrypt data on the network. Other networking aspects of a cloud platform include load balancing, content delivery networks, and domain name services.

Comparison of Cloud Service Providers

The Modern Data Platform is a future-proof architecture for business analytics. It is a functional architecture with all the components to support Modern Data Warehousing, Machine Learning, AI development, real-time data ingesting and processing, etc., and to leverage this, businesses need Cloud service providers who could provide services ranging from complete application development platforms to servers, storage, and virtual desktops. Based on the requirements, these providers are shortlisted to maximize the benefit to the enterprise. The cloud data platform helps enterprises extract high-value results to serve their customers in a data-driven future.

Affine’s Analytics Engineering practices can help with this seamless and effective transformation. Are you ready to embark on your journey to true data-centricity? We are here to help. Setup a call now!

The Modern Data Platform itself has proved as an asset to enterprises. So, what kind of data strategy and roadmap is needed to execute cloud-based solutions?

Well, that is the story for the next episode of the Modern Data Platform Series.

Till then, keep reading:

Episode 1: What Is Modern Data Platform? Why Do Enterprises Need It? – Affine

Episode 2: What are legacy systems? How Can Modern Data Platforms Bring Revolutionary Change? – Affine

About The Author(s):

The Modern Data Platform blog series is a part of research efforts conducted by the AE-Practices, which exists solely for hyper-innovation in the Analytics Engineering space. 

Our AE Practices is a dedicated in-house team that caters to all R&D needs. The team is responsible for continuously working on research tools and technologies that are new, happening, futuristic, and cater to business problems. We build solutions that are both cost and performance effective. Affine has always been deeply invested in research to create innovative solutions. We believe in delivering excellence and innovation, driven by a dedicated team of researchers with industry experience and technology expertise. For more details, contact us today!

What is Merge? Deciphering the future of the Crypto World

Cryptocurrency mining is extremely energy intensive and considered an environmental menace. Until recently, Ethereum was just another power-hungry cryptocurrency, but The Merge just fixed that.

With The Merge, the Ethereum blockchain has moved its consensus from proof-of-work to proof-of-stake and will burn significantly less ether (up to 99.95% less carbon footprint) compared to the previous proof-of-work method which used to burn billions of dollars’ worth of ether per year. I’m aboard the train of a greener earth and becoming more eco-friendly with sustainability while saving natural resources, which The Merge has helped further.

What is Merge?

The Merge is an upgrade of the Ethereum blockchain from a proof-of-work to a proof-of-stake system for authenticating new transactions. The new system replaces the old power-guzzling system.

With the Merge, the crypto industry sees an immediate slew of advantages:

  • Remains a decentralized platform
  • Extremely secure transactions
  • Up to 99% power efficiency compared to proof-of-work currencies like Bitcoin
  • Eliminates the need for miners and mining farms to authenticate transactions

Why is ‘The Merge’ a Marvel?

The open-sourced Ethereum is the host of DeFi protocols, NFTs, and cryptocurrencies valued at over a hundred billions dollars. All these digital assets were at stake, possibly being wiped out or irrevocably broken. The blockchain system verifies and processes new crypto transactions and migrating to a new type of system on the go is no simple feat by any means! It is akin to replacing an engine midflight without hiccups, but all it took for the merge to unfold was 15 minutes! I’ve been unwilling to participate in many Windows updates, which took more time, and I couldn’t use my device during the process!

It was around 2018 that I played around with cryptocurrency and even made a small profit. While I know many people who still gamble in the crypto market, I’ve since chosen to be a curious spectator of the volatile cryptocurrency market.  Many cryptocurrencies have debuted and seen their demise rapidly, but the two giants that have flourished so far are Bitcoin and Ethereum.

With The Merge, Ethereum is Now Environmental Friendly

It is a well-known fact that cryptocurrencies are power guzzlers.

I vividly remember the GPU hoarding craze recently and the large server farms used for Ethereum mining. The sheer power required to mine cryptocurrency is astounding and can power small-sized European countries!

This revolutionary feat made Ethereum 100x more efficient than before and that, which is nothing to scoff at. The long-term gains and the operational efficiency are remarkable and have left me awe-struck.

For all the environmental aficionados, The Merge is more of a festival thanks to the decrease in Ethereum’s footprint. However, that is more of a moral victory in anyone’s book

What Did This Mean for Investors and The Industry?

The Merge resulted in an interesting reaction from miners. I was excited about the energy efficiency and have been glued to crypto news, only to find that miners have moved on to greener pastures mining other currencies. The Merge has not created any substantial value for Ethereum as of now. Last I checked, Ethereum stood at a market capitalization of over $164 billion after the Merge. It used to hover over $200 billion.

The most significant advantage is that security will increase thanks to the proof-of-stake, which opens the option for varied granular incentives, unlike the proof-of-work consensus. This is because each validator’s stake is accessible.

I’m interested in seeing what types of rewards the stakeholders will earn. In the new consensus, validators are called stakeholders (people who stake a minimum of 32 Ethereum) in a secure network where trading is prohibited. In simple words, users earn Ethers by locking up their coins and validating transactions. It is impossible to predict the staking yields as more than 13.7 million ETH have been locked in the staking contract. stakeholders won’t be able to withdraw until a mid-2023 update. This should bring a little more structural stability and safety to Ethereum trading.

This is vital as the reputation of Cryptocurrencies in the past years has been tarnished thanks to hacks, scams, and billions of dollars lost due to new crypto companies shutting shop. I know a few people who bet big on Dogecoins, who thought it was the next Bitcoin but were left dejected.

The Merge Makes Ethereum More Secure Against Attacks

A significant upgrade I see is that the amount of Ethereum staked instead of resources spent defines network control. With the proof-of-work method, groups with large server farms could join forces to attack the network and sabotage others’ chances to update the ledger, opening options for higher rewards. With the new consensus, anyone trying to do that would be punished.

Although it seems like some people in the industry are a bit more apprehensive about the development. I was surprised by Changpeng Zhao, Binance’s CEO’s take on the Merge. According to him, the drop in Ethereum transaction fees is still a long-term reality, as he doesn’t expect it to fall drastically overnight. That seems to be the popular opinion, but the story might change in the long run.

Ethereum’s biggest competitor, Bitcoin, has no plans for such a migration. It is still energy-intensive and continues to run on the proven proof-of-work consensus. In fact, it was Bitcoin that pioneered the consensus, and Ethereum just followed suit. But competitors are not Ethereum’s concern now when enemies are in their camp.

Some Ethereum miners against the new consensus are fighting to keep the proof-of-work system alive. Their future is anyone’s guess as it’s impossible to determine the future token value.

Personally, other than the environmental-friendly badge, I don’t see any short-term advantages of The Merge.

What’s next for crypto?

The heavy carbon footprint was the least of the issues with Crypto’s bad reputation.

In my opinion, one of the biggest threats to Crypto has been government regulations, thanks to the various crypto scams. An imminent ransomware threat, major scams and a lack of proper understanding of the technology means the government will always be apprehensive about regulating cryptocurrencies. The Security and Exchange Commission’s recent claim that all Ethereum transactions belong to them raises many questions. Teething troubles post- The Merge, or any such innovation, are not surprising, but the division in the crypto community and the after-effects remain to be seen in the long run.

With the eco-friendly badge, I’m hoping the government regulations become a little more lenient and have a more explicit stance on cryptocurrencies. A clearer legal picture will give cryptocurrencies the much-needed relief and attract more people to invest in them. If eco-friendly cryptocurrencies are favored more by the government, we may see others jump ship, but I don’t speculate that happening anytime soon.

With The Merge, we only have bragging rights about the eco-friendly aspect. However, that will possibly soften governments’ legal stance on cryptocurrencies worldwide.

Don’t get me wrong, the Merge, to me, is a technical feat and is the right step towards a greener earth, but the lack of profitability for stakeholders meant that this was bound to happen. As I mentioned earlier, legal troubles seem to accompany cryptocurrencies. With the Merge, Ethereum is now even more secure, but it seems to have attracted some controversial attention.

Gagan Mahajan heads the Entertainment, Tech & Media Practice at Affine. Affine is a pioneer and a veteran in the data analytics industry and has worked with giants like Warner Bros Theatricals, Zee 5, Disney Studios, Sony, Epic, and many other marquee organizations. From game analytics and media and entertainment to travel & tourism, Affine has been instrumental in the success stories of many Fortune 500 global organizations; and is an expert in personalization science with its prowess in AI & ML.

Learn more about how Affine can revamp your business!

Film Wars- Stepping into the New Age of Content Viewership

It was 2009 when Avatar came out, and as a college student, I was proud to witness the spectacle of a technically-sound 3D movie, a cinematic experience of a lifetime.


More than 12 years later, Avatar still holds the record for the highest-grossing cinema of all time, with a worldwide collection of $2.847 Billion!

Avatar was a movie best watched in theatres for that astute and wholesome cinematic experience, an experience impossible to mimic even with the latest home entertainment options.

A decade later, Marvel positioned itself next in line as the second highest worldwide grosser of all time with Avengers Endgame in 2019.

A lot has changed in a decade. Marvel built its base for about a decade with its standalone comic-book movies and two other Avengers movies before achieving this feat at the box office. It was smart enough to understand the pulse of the audience and the growing interest in comic book-themed movies and TV shows.

Marvel became a giant over the years as the viewer preferences started to change, and a growing interest in live-action movies based on comic sources began to gain traction.

Cinephiles vs. Comic Book Fans

I am an avid cinephile, taking every chance to watch classics like The Godfather, Taxi Driver, Goodfellas, and Pulp Fiction, to name a few. So, when Martin Scorsese made an infamous statement comparing Marvel movies to amusement park rides, I could not help but agree with his view. A cookie-cutter template with abundant fan service and politically correct inclusive messaging is what phase 4 of Marvel looks like.


But personal opinion aside, the flavor of the season had changed, and comic book movies were minting money at the box office. This was an interesting phenomenon for someone in the Entertainment, Media, and Gaming industry. The gaming industry coined money and beat Hollywood revenue with Grand Theft Auto 5. During the pandemic, the gaming industry saw the highest footfalls among its peer industries. Unfortunately, that was not the case for theaters.

The Downfall of Theater Viewership


Theatrical revenue hit an all-time low after the shock of COVID, and the 2020 revenue numbers paint the picture perfectly.

But now that the dust has settled, the theater viewership has not. And one cannot blame the pandemic as the only reason anymore.

Consumer psychology has drastically changed post the COVID scenario, and according to a study, 55% of people preferred watching movies at home.

Theatrical vs. OTT Releases

Live-action movies that followed a pre-set template were safe for producers, worked well at the box office, and garnered enough business worldwide. Or at least, so I thought.

The pandemic came in like Thanos and, with a snap, reset the box office game.

OTTs had already become a vital part of everyone’s lives. I am subscribed to most OTTs, and it is a similar case amongst my peers and friends.

Due to the pandemic, most theaters were forced to shut down temporarily in 2020. With accruing interest in productions, studios had no other option but to release movies directly to OTTs. As people themselves could not freely wander out due to the lockdown norms, OTTs had become their go-to source of entertainment. During the lockdown, I caught up with Better Call Saul, Stranger Things, and many other TV shows and movies.

What did this do for the industry?

For one, the outdated exclusive window requirements saw a fall. Hollywood movies would only be released seven months after their theatrical release. This number was reduced to 45 days.

Studios are double dipping with theatrical and OTT releases, with the shorter window favoring OTT revenue a little more.

For theatrical releases, the first 38 days are crucial. But as I have stated earlier, Hollywood has struggled to provide a theatrical blockbuster for a long time outside of Marvel and DC.

High budgets, worldwide promotions, and a 50% split with exhibitors have added conundrums, whereas studios can have field-day OTT releases where they get to keep 80% of the revenue.

The Race to Beat Netflix

Netflix may have been the innovator in the streaming space, but as things stand now, I don’t see them having any particular edge over competitors compared to a decade ago.

Do not take my word for it; they are seeing a dip in subscribers and are even planning for a basic ad-included tier, which goes against what Netflix initially did. However, such is the current state of the saturated market amongst streaming platforms

Giants like Paramount, Disney, and HBO now have almost equal footing in the streaming space, and these players are veterans in the media and entertainment industry compared to Netflix. HBO Max will have an added company value of as much as $14 billion if it adds 11 million users at $144/year.

Jason Kilar, CEO of Warner Media, said the long-term value of HBO Max subscribers is worth more than the box office revenue of not just one of these movies but all of these movies!

While individual movies are devalued in their move to a streaming platform, the collection for the platform sees an increase in value, which is an ecosystem in itself and gives an incentive to the buyer to subscribe.

So, should Studios opt for streaming releases over Theaters?

As far as I see, there is no concrete answer here. No doubt theater releases have become tricky business-wise with so many parties involved, more rules, fewer shares, etc., but Top Gun Maverick just pulled off a sweet surprise with majestic global revenue, hitting a home run.

It is still doing great business, lasting over newer releases. Tom Cruise has consistently proved that he is a beast who can carry mega-blockbusters with ease, and the movie was a riot to watch in theatres and a treat after the extended lockdown. “Top Gun” is a fantastic movie without a superhero element, sans Tom Cruise!

Meanwhile, Marvel’s new phase is in a tricky spot. Thor: Love and Thunder got a lukewarm welcome, and She-Hulk, the TV show, looks dead on arrival. As I mentioned earlier, the message and preaching are getting old.

On the other hand, DC has canceled Batgirl and Supergirl projects worth over $70 million, which raises more questions. For one, the material may be questionable, which is what my research has led me to believe. Fans are not super impressed by political correctness and tend to pay attention to messages over the quality of content. People now are looking for pure entertainment in an overly politicized world.

The Right Time to Release Movies on OTT Post Theatrical Release

If a studio opts to prioritize OTT, it endures a significant financial squeeze in the short term to gain long-term financial security through scaled streaming.

This requires an astronomical investment and is a task in itself. Few services will survive the gauntlet. Those that do will be in a position to generate massive annual revenues.

Box office tickets and streaming revenues cannot be fairly compared as they are quite different.

Direct revenues from streaming may be lower, but they may be less volatile, replaced by more stable monthly subscriptions, like how boxed software suites have shifted to subscription services.

I think a portfolio-based approach is optimal for now and will bring balance on all fronts.

For value-based audiences and audiences for niche content, low production releases in large numbers are preferable. In such a scenario, immediate release to OTT is beneficial to studios, too, with more significant margins.

Warner Bros. Discovery has shifted the previous 45-day theatrical window put in place by former Warner Media CEO Jason Kilar, and now, new Warner Bros. films are no longer guaranteed to hit OTTs on that schedule.

The studio remains committed to the 45-day theatrical window but may extend the time between when a film is first released in theaters and when it is streaming on HBO Max.

My intuition tells me the release timing will vary based on the movie.

There is a dire need for studios to balance the revenue between Theaters and OTT platforms. With the audience split between Theater and OTT preferences, the right balance to capitalize on these potentials is the challenge of the hour.

The wave of change in viewer mentality has already hit, and the ecosystem of streaming platforms has made it even more challenging for studios. Still, double-dipping between theaters and Streaming platforms is possible if powered by an AI-powered data-backed solution.

Affine’s Movies/Shows cadence planning leverages box-office performance data with extensive reports and plans for a feasible and dynamic post-theatrical right-acting as a movie planning solution for OTT platforms. It proposes an ideal data-backed active window for OTT platforms to release a movie post-theatrical release and ensure maximum profits for the production house and significant benefits for SVOD/OTT platforms.

The payoff is that studios can double-dip their revenue while finding the ideal balance and catering to theatrical and streaming audiences.


I, for one, do not believe in a monopoly either on Streaming platforms or Theaters. Personal observations have led me to believe that the viewership behavior and content preferences have vastly changed over the years, but theaters and streaming can coexist peacefully.

Studios need to release their content backed by data to understand viewer preferences. Mega flicks with superior cinematic values are no brainer a theatrical release, but a conservatively produced movie might not share the same fate.

But this is just a general rule of thumb. Studios, with their multimillion-dollar projects, can’t just go based on this, a thoroughly researched strategy powered by AI catering to this viewer-driven market.

What does Affine bring to the table?

Affine is a pioneer and a veteran in the data analytics industry and has worked with giants like Warner Bros Theatricals, Zee 5, Disney Studios, Sony, Epic, and many other marquee organizations. From game analytics to media and entertainment, Affine has been instrumental in the success stories of many Fortune 500 global organizations; and is an expert in personalization science with its prowess in AI & ML.

Learn more about how Affine can revamp your film production business!

What is Reverse Supply Chain & Why is it Important?

It’s appealing to commit all your business efforts to the forward supply chain, but the “reverse” practice is also crucial for many businesses. From coordinating defective goods returns to picking up empty packaging to collecting old household appliances and other used products, these operations necessitate a streamlined and effective reverse supply chain.

Why would a business need to implement and then reverse a supply chain? Isn’t it perplexing? Let’s dive right into the details.

What is a reverse supply chain?

It’s the series of activities to retrieve a used product/part from a customer, either dispose of it or reuse it. And for a growing number of manufacturers in industries ranging from handbags to supercomputers, the reverse supply chain has become an essential part of their business.

In some regions of the world, companies are forced to set up reverse supply chains because of ESG or consumer pressures.

Let’s consider Kodak; it remanufactures its single-use cameras after the film has been developed. Over the past 10 years, the company has recycled millions of cameras in more than 20+ countries. Few companies are using reverse supply chains as an integral part of new and existing businesses, such as Bosch.

When a company establishes a reverse supply chain by choice or necessity, it faces many challenges. It should educate its customers and establish new points of contact with them, decide what activities to outsource and what to do, and figure out how to keep costs to a minimum while discovering innovative ways to recover value.

Key Components of the Chain

To understand the structure of a reverse supply chain, let’s divide the chain into its five key components:


The task of retrieving used products is key to creating a profitable chain. Product returns’ quality, quantity, and timing need to be carefully understood and managed. Furthermore, companies may be flooded with returned products of such variable quality that they make remanufacturing impossible. Companies often work closely with retailers and distributors to coordinate collections.

Reverse Logistics

Once collected, the products need to be transported to facilities for various processes such as inspection, sorting, and disposition. There is no one “best” design for a reverse logistics network; each must be tailored to the products involved and the economics of their reuse. Bulky products like refrigerators, for instance, will require very different handling than small but fragile products like cameras, lenses, etc. Companies consider not only the costs for shipping and storage but also how quickly the value of the returned products will decline and the need for control over the products. In many cases, companies outsource the logistics to a specialist, which makes better sense in some scenarios.

Sort, Sweep & Segregate(3S): 

The check, sort, sweep, segregate, and grading of returned products are labor-intensive and time-consuming tasks. But the process can be streamlined if a company subjects the returns to quality standards and uses technologies to automate (such as sensors, bar codes, etc.) to track and test them. A business should learn to make 3S decisions based on quality, product spec, or other variables at the earliest possible stage during the return process. This helps eliminate many logistics costs and gets remanufactured products to market faster.

Refurbishment – Renovation

Companies may capture value from returned products by extracting and reconditioning components for reuse or remanufacturing the products for resale. Reconditioning and reproduction processes are much less predictable than traditional manufacturing because there can be a large degree of uncertainty in the timing and quality of returned products. Making smart decisions while accepting and sorting returns will help largely reduce manufacturing variability and costs.

Market Re-entry

If any company plans to sell a recycled product, it first determines whether there is a demand for it or if a new market must be created. The company needs to invest heavily in consumer education and other marketing efforts if it’s the latter. Potential customers for remanufactured products or components include not just the original purchasers but also new customers in different markets. The company will sometimes target customers who cannot afford the new products but would jump at the chance to buy used versions at lower prices.

Artificial Intelligence for Reverse Supply Chain

Using AI for reverse supply chain management enables businesses to address waste management and environmental sustainability issues.

The reverse supply chain is a part of a more significant concept known as the circular economy, which seeks to tackle problems such as waste reduction, pollution, biodiversity loss, and climate change. Considering sustainability, governing bodies around the world create product take-back laws, which hold manufacturers financially accountable for factors related to waste recycling, handling of perishable goods, and to produce circular products. Managing these activities effectively offers businesses a more significant challenge in reverse logistics. Using new approaches and tools like AI for reverse supply chains can help overcome the challenges associated with reverse logistics.

To optimize the performance of the reverse supply chain, there is a need to establish an effective and efficient infrastructure via optimal network design. Generally, reverse supply chain network design is concerned with establishing an infrastructure to manage the reverse channel, which often consists of final users, collectors, and remanufacturers.

Using Artificial Intelligence (AI) for reverse logistics offers a great range of solutions to get the world closer to the ideal circular economy. Artificial Intelligence driven data analytics, image processing, and other techniques can simplify reverse logistics.

Classifying Waste Materials

Artificial Intelligence based waste recognition systems feature image classification and processing to remove inconsistencies from the process of material sorting and composition analysis. Thus, waste materials’ identification and categorization are optimized to maximize recycled goods’ quality. Artificial Intelligence-based machine vision recycling systems enables waste managers and recycling department to receive valuable insights to increase the recycling rates and product value. Machine vision-aided image processing holds the potential to add new dimensions to the waste management and product recycling processes. Using 2D and 3D imaging, Artificial Intelligence allows the businesses to optimize waste material segregation.

Repurposing Returned Goods

Automated analytics and AI are potent tools for repurposing goods that your customers have returned. So, the business can choose whether it must liquidate, re-shelve, recycle, or scrap a returned product after an Artificial Intelligence-based tool assesses and predicts the usability and condition of such goods. Additionally, Artificial Intelligence also predicts and provides recommendations about how businesses can dispose of returned products at the point of return. So, selecting the best option for processing a returned item can be automated, thereby increasing its speed and effectiveness in decision-making and reducing the expenses incurred for each returned item.

Artificial Intelligence can also be deployed to reroute products in reverse logistics that their buyers have returned. Using its decision-making tools and inventory management systems, assess a returned product’s condition and various other factors, such as demand for the same product in other regions, before recommending to the sales team to market the product in such areas.

Designing Circular Products

Artificial Intelligence helps speed up circular products’ overall design and development processes to make them arrive in commercial markets sooner. Machine learning-based systems produce components, materials, and products that fit the ideal circular economy. Artificial Intelligence enables designers to select product designs faster as the technology analyzes large amounts of data and quickly suggests optimal designs and their adjustments. Once the base design with various tweaks and changes is suggested, the product designer can start creating the product that will be the most sustainable and recyclable. The insights generated by Artificial Intelligence are responsible for manufacturers creating circular products quickly in the most cost-effective way.

Reverse Supply Chain Use Cases

  1. The best example of a business leveraging Artificial Intelligence to resell its returned goods is the return management strategy by IKEA. The renowned conglomerate deployed an Artificial Intelligence-based solution to ensure that the large and expensive merchandise returned is not wasted. It has been found that one in every ten products comes back from being sold by the Swedish company globally. To reduce the losses, IKEA chose Oporto, a specialized reverse logistics-based software company, to design a predictive Artificial Intelligence tool that provides suggestions backed by data for the best possible destination for returned merchandise. The Artificial Intelligence tool allows IKEA’s product managers to know whether a returned product should be sold to a third-party retailer, donated to charity, or brought back to the floor.
  2. H&M is a clothing brand that has used the concept of “Reverse Logistics” innovatively. H&M accepts old clothes of any brand. They take the used clothes to create their all-recycled clothing line. The idea behind this is to connect people with the brand by selling to them and making them involved with the brand by giving away their old clothes.
  3. Apple manufactures various products, such as the iPhone, MacBook, etc., and sells them in its stores worldwide. Apple lets its customers return their old Apple phones when they want to upgrade to newer ones. They take their customers’ old phones and provide a discount on the new ones. Apple takes the old phones back to their factories and uses the parts of the old phones to manufacture new phones. This not only makes them more profit but also helps manufacture products in an environmentally friendly way.
  4. Amazon is one of the largest e-commerce websites and a pioneer in selling online. Initially, it was difficult for e-commerce websites to gain customers’ trust. Hence, Amazon started a free-of-cost product return and replacement policy on certain products only under specific conditions & also when the customers have a genuine reason to return products. Amazon handles its reverse logistics process through various third-party vendors and organic resources such as Genco, FedEx, and many other small vendors. This way, they gain their customers’ trust and ensure that their sellers provide good quality products to the customers so that fewer returns occur.

Few KPI’s considered

  • Disposition Cycle Time: Cycle time is the total time it takes to move a unit from the beginning to the end of a physical process.
  • Handling Cost: Handling costs are the cost of holding products in the inventory.
  • Cost of Repair or Refurbishment: Understanding the cost of repair or refurbishment is a common KPI that is measured. 
  • Rate of Recovery: How much effort did you spend repairing the item? How long did it take for the item to return to stock? How much did it sell for on an online eCommerce channel? The recovery rate will show you how much value you recovered after selling the item.

Final Words

Companies that have had the most success with their reverse supply chains are those that precisely synchronize them with their forward supply chains, resulting in what is known as a closed-loop system. The approach significantly reduces inspection and disposal expenses, allowing the business to profit from remanufactured tools. Forward-thinking yields significant returns, even in reverse supply chains. 

Schedule a call today to learn more about our success stories and capabilities in the Manufacturing sector.

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Manas Agrawal

CEO & Co-Founder

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