While eCommerce companies are seeing an uptick in spending on their goods, they’re also seeing more and more returns as a result.
As much as 40 percent of purchases in some online segments are returned, especially when it comes to fashion and other areas where fit is critical. Sure, you may not be seeing numbers that high, but whatever your returns rate, there’s a good chance you could reduce the costs involved.
Reverse Logistics and the Cost of Doing Business
There’s no question that returns management, also known as reverse logistics, is now just part of the cost of doing business for online merchants and those with large online order fulfillment branches. But like any cost, it can be minimized if you really work at it.
Here are just a few tips for lowering your returns management costs:
Make your physical store do double duty. Don’t have a reverse logistics team in their own warehouse? How about allowing your customers to bring their online returns right into your store?
That way your friendly customer service folks can ask a few questions about the item, grade it and issue a credit all from the same spot — and with little extra effort. You’ll still need somewhere to send those returns for the next step, but you’ll save on return postage and upfront labor.
Integrate those databases. It might have made sense to keep separate databases for inventory, purchases and returns at one point in time, but today it’s costing you money you could be saving. When your records are all in the same place, returns are a whole different game.
From a single database, you can find out where the purchase originated and begin the reverse logistics process quickly. These setups can also flush out fraud returns more accurately than multiple databases across several platforms.
Speed up product grading. Using deep computer learning, your systems can help speed up the grading process. Since grading can be a huge drain on resources, it’s nice to have a computer that can not only give criteria for grading product returns, but interact with marketplace information to determine the value you’ll get out of any given returned item and help you choose the most profitable channels for disposal.
Perhaps the most important tip for lowering returns costs is to not have the returns in the first place. That means more accurate images, better measurements and really great descriptions that give a person the sense that they’re really holding the item in their hands. You’ll still have returns, but the better the description, the fewer returns that will come down the pipeline.