In every company, it is very important to attract new customers and retain the current customers on viable conditions. These actions cannot be accomplished in any single company without creating a competitive advantage. The main technique of creating a competitive advantage that a company can adopt is creating quality products or services than their competitors. They can also create products that the target customers would prefer than their alternatives. Many companies across the world have adopted reverse logistics as a strategy to increase competitive advantage. This is because this technique lowers supply cost in the supply chain. Companies using reverse logistics can also reduce the opportunity cost of outdated products. Companies can also gain additional revenue and finally reduce the cost of operation. This is due to the fact that companies can be able to manage the flow of their products through the supply chain. Reverse logistics is also advantageous as it expands the global economy. Thus reverse logistics can be defined as a process of controlling the flow of finished goods from their final destination back to the manufacturer for value addition so as to enable recycling or reuse or for proper disposal. Reverse logistics can be used to explain environmental externalities resulting from increased production and supply. The following essay will be on the theories that have been put in place in regard to creating competitive advantage through reverse logistics and evidence of the theories