Reverse logistics plays a vital role in the construction and mining equipment industry, where managing product returns efficiently is critical for both cost optimization and sustaining dealer satisfaction. This project conducts a financial analysis of the current reverse logistics process for a leading industry player, focusing on the adequacy of their restocking fee strategy implemented in 2015. Using Activity-Based Costing (ABC), the study dissects return workflows across various return types to identify true cost drivers and proposes a new data-driven restocking fee. Findings reveal that the existing flat percentage restocking fee significantly overstates actual processing costs and does not account for variation in return effort. The research also highlights hidden costs from dealer non-compliance, such as incorrect documentation or shipment errors, and recommends a strike-based non-compliance fee model to improve adherence and reduce operational inefficiencies. Ultimately, this project equips the partner company with a transparent and equitable cost model to better align pricing strategies with actual logistics costs while reinforcing process discipline across its dealership network.