For online retailers, as much as 30 percent of your sales may ultimately come back. There’s no single solution to help slow the bleed, but you can make the best of your returns management and focus on how good reverse logistics pay you back right away.

Customers Love Good Reverse Logistics

Returns are inevitable, so you might as well use them to build a stronger relationship with your shoppers and inflate your reputation as a business that’s easy to work with.

According to ComScore, about 63 percent of customers review your returns policy before making a purchase. If your policy is lacking, or you’re lacking a policy, it can spell disaster. But, for brands that have customer-friendly returns policies, these are a few of the ways they can pay you right back:

• Improving customer goodwill. The customer experience is everything these days. After all, your products are likely also sold by other vendors, so you have to have something extra that makes people want to use your business above all others.Giving customers a good experience by throwing in little things like smart labels or instant refunds can be a huge thing, even enough to create lots of enthusiastic brand ambassadors.
• Fueling future purchases. Any time a shopper uses a new shop, they’re hesitant, especially if the vendor is more clicks than bricks.If your first order doesn’t go exactly as planned, but you make it right quickly and with no roadblocks, those customers will be more comfortable buying from your shop in the future. And they’ll tell their friends that you can be trusted. It’s a big deal for a little reverse supply chain magic.
• Getting products back to resell. When your returns policy is easy for the customer, you can count on recovering more money out of each item that’s being returned.Items that arrive back at your facility in perfect condition because they arrived in the wrong color, for example, can immediately go back into inventory, giving you another chance to sell them for full price. Items that aren’t as perfect will still recover more of their value the sooner they’re sent back to you because they’re still in style and up to date.

Good returns mean good business and lots of goodwill between you and your customers. If you don’t have a dedicated reverse logistics team, there’s no time like right now to add one to your supply chain. Your favorite 3rd party logistics companies often offer returns management for less than you would pay an in-house team and they’ll handle those returns per your specifications without having to be trained from scratch.

The post 3 Ways That Good Returns Pay You Right Back first appeared on Smart Returns.

In fact, the Census didn’t bother to record their sales until 1999, when eCommerce represented just 0.6 percent of the retail sector. At the end of 2017, eCommerce controlled 9.1 percent of all retail sales, and now it’s a freight train out of control. With a compounded annual growth rate over the last five years of 14.7 percent, and similar projections through 2022, there’s no ignoring this sector any longer.

It should go without saying that eCommerce is here to stay.

eCommerce Logistics Costs Shattering U.S. Records

A new report by Armstrong & Associates, Inc. estimates that U.S. eCommerce logistics costs have hit a record-breaking $117.2 billion, a figure that’s equal to about seven percent of all U.S. logistics costs. These costs include things like domestic and international transportation, warehousing and fulfillment, last mile and reverse logistics.

This is, in part, due to the rapid growth of the sector, but it’s equally attributed to the ever-rising bar of shipment speed on both the customer-facing and reverse logistics ends. Two-day shipping isn’t a novelty anymore, and online shoppers expect to have their items in hand quickly and to just as quickly have them returned and credited.

Traditional retailers have tried to solve this conundrum in several ways, but seem to continue to seek less expensive options. Site-to-store delivery is popular because it gives customers fast, free shipping and only asks that they come to the store, where they’re likely to buy something additional while they’re waiting for their order to be located.

Still, the reverse logistics side of this, returns to store, is costly and can be confusing for both customer and retailer because of returns processes that are built on the old models, designed without eCommerce in mind.

Is it Sink or Swim in The Age of eCommerce?

Traditional retailers still command a huge portion of the retail sector, but more are being forced to figure out how to integrate some type of eCommerce into their legacy systems.

They’re at a distinct disadvantage in some ways simply because they’re having to work a whole new way of doing things into a system that they thought was perfected long ago. Slow, steady reverse logistics isn’t enough anymore. Today it’s all about no-questions asked returns, fast credits and significant numbers of returns that have to be managed.

Even though traditional retail continues to be the mainstay of the sector, there’s plenty of evidence that eCommerce is increasingly becoming the avenue of choice of shoppers across the board. In order to remain competitive in this market, traditional retailers have to find a way to absorb the additional costs of an eCommerce division or risk being overwhelmed by retailers who will.

The post eCommerce Logistics Costs Hit Record Highs In U.S. first appeared on Smart Returns.

Reverse fulfillment is the yin to their customer-facing fulfillment yang, and it’s vital to the success of any business in the era of the lean supply chain.

The Basics of Reverse Fulfillment

When you get a returned item, what do you do with it? Does it sit on a shelf until you find the time to check it out, clean it up or throw it out? Lots of retailers still do, costing themselves plenty in the process. That’s why an entire arm of the supply chain has evolved to handle returns, that’s the reverse management portion, also known as returns management.

Because some eCommerce retailers experience up to a 30 percent return rate, a streamlined process had to be developed to move those items quickly back into inventory, despite the widely varying package contents that were being handled. But, what do you do with items that aren’t resellable as is? What is they’re damaged or worse, they’re not even what they’re supposed to be?

Reverse logistics handles these issues for retailers of all kinds, while creating additional income streams that help retailers recapture much of the money lost on the initial return.

These are just a few ways returns management can do that:

• Rapidly returning to stock. Items that are ready to return to the sales floor or online inventory should go back as quickly as possible so you can resell them at full value. Any hesitation means you may be forced to sell them for less than full price because they’re suddenly out of season or have been replaced with a newer model. Retail moves fast, but reverse fulfillment can move faster.
• Broken or damaged goods can often be saved with a little bit of elbow grease. Good returns management companies have relationships with experts who can refurbish your equipment, mend your clothing and repair your sports equipment. You might not get full price out of your refurbished goods, but you can recapture a large percentage of the original value.
• Goods that are totally dead on arrival, like a cellphone that just won’t work despite great efforts, are prime candidates for recycling. In many cases, the rare metals inside electronics and other equipment are valuable enough that they’re worth sending off for recycling. Reverse logistics companies keep an eye on the value of these scrap metals and can advise you on the best plan for recapturing costs from DOA products through recycling.

Reverse fulfillment is so much more than just taking products back from unhappy customers. Along with helping you maximize profits from your returns, your reverse fulfillment team can handle any recalls that might be applicable to your products, freeing you up from one more tedious job. This is a partner that can do a lot behind the scenes to further streamline your retail efforts.

The post What Is Reverse Fulfillment? first appeared on Smart Returns.

Sometimes it’s not that you can’t provide the same level of care in your supply chain as your competition, it’s that you want to do even more to ensure that one time visitors to your website become lifetime customers and that your reputation shines while you do it.

This is why you’re doing all you can to eliminate waste and make your process faster. But have you considered what happens when items are exchanged or returned?

Thinking About Reverse Logistics

For many companies like yours, returns management is often the last thing considered when building a supply chain.

Although no one wants to plan for returns, the fact is that returns are as much of a piece of the retail environment as sales and customer support. Sometimes customers order the wrong item in the wrong color, sometimes your outbound logistics company makes a mistake and ships an incorrect SKU. No matter where the problem originates, you have to have a plan in place for correcting these types of errors, or else why bother with any of it?

Reverse logistics is a key part of your supply chain, so much so that customers are easily turned off if they discover that it’s difficult to return a product to your company. In a recent survey, UPS found that only 65 percent of shoppers were satisfied with their ability to return items online; in-store returns didn’t fare much better with only 67 percent of surveyed shoppers satisfied. When it’s difficult to return orders that arrived in a condition that wasn’t expected, your customers will quickly find another retailer.

Improving the returns process for shoppers is only a small portion of what returns management can do for your business, however.

Here are some additional benefits to having a great reverse logistics chain in place:

• Sorting out returns. Items that leave your facility usually do it in a very uniform way, but those products that return can come back with a fairly haphazard order and frequency. This is no problem for reverse logistics, in fact, sorting it all out is what they do best. This way items that can be immediately resold are sent straight back into inventory and other products are moved into an area for refurbishing or recycling.
• Refurbishing merchandise for resell. The best returns management companies not only accept items on your behalf, they also arrange to have damaged items repaired (or do this themselves). From packaging damage to fixing products that simply don’t work, these companies can help you get considerable value back from returned items.
• Recapturing value by recycling. A third function of US reverse logistics is determining the ideal way to dispose of items that cannot be fixed or repackaged. Sometimes, this means arranging for proper legal disposal, but often it can also mean selling them for scrap value to another party. Recycling may not recover a lot of value, but it saves money on disposal fees and helps improve your company’s carbon footprint.

Reverse logistics is just as important to the functioning of your business as your outbound logistics. You should think of them as two sides of a whole, not as two separate and disparate parts.

The post Why Reverse Logistics is a Key Part of your Supply Chain first appeared on Smart Returns.

A really good returns process backed by an excellent reverse logistics team can make a dramatic difference in your number of sales and your bottom line.

If you’ve not designed your returns process to be easy, here are some ways to streamline it right now:

• Make it easy for your customers to initiate the process. So many eTailers seem to secretly believe that hiding the returns process will somehow make it impossible for customers to return their orders.What they’re really saying to their shoppers is “I’m not going to service you after the sale.” Instead of forcing shoppers to call or email for instructions, trust your customers and let them initiate the process through your website.
• Collect some basic information, but no more than necessary. It’ll help your returns management team to collect some information up front, but don’t force your shoppers to write a novel about why they’re returning an item.A simple form with basic information like their contact information and what they’re returning is more than enough to start the reverse logistics machine before the package even arrives back at your facility.
• Provide a return label or schedule a pick-up. As an eCommerce retailer, you need to be able to provide a helping hand with shipping. Giving customers a label they can print and stick to their package, or better yet, including one with every shipment, and even allowing them to arrange a pick-up from your shipper can make returns go faster.Instead of customers having to hunt for a UPS or FedEx drop-off site, a driver can pick up that box from their stoop tomorrow morning. Returns like this go faster, your customer get their credit faster, and that item returns to inventory faster. It’s a total win-win.
• Keep the customer in the loop. Ultimately, you can have the best, most streamlined returns process in the world, but it can still be a great big failure if you forget to include the customer.Like you, they want to know when their package is received, when it’s processed, and when their credit is due. Remember to include a customer web portal to ensure they’re able to access their shipment at any time, day or night.

Streamlining your returns process can make your reverse logistics process easier and your customers happier. Instead of waiting until the last minute, shoppers are more likely to send orders back right away, and you’ll know exactly what’s coming to your door with a quality returns process.

The post 4 Ways Your eCommerce Retail Site Needs A Streamlined Returns Process first appeared on Smart Returns.

In fact, according to a recent survey by UPS, “clear and easy” returns policies are still a huge sticking point for many. With only 67 percent of those surveyed reporting satisfaction on this hot topic, there’s still a lot of room for improvement.

It’s time to ask yourself, “Just how easy is my easy returns policy?”

Making your Return Policy Easier

Believe it or not, there may be a lot of value in making your return policy much easier to swallow.

Marketing consultant Walker Sands Communications recently found that free returns and exchanges could make 68 percent of shoppers more likely to shop online. Furthermore, this meta-analysis from the University of Texas at Arlington indicated that easier and more lenient returns policies tend to increase overall purchases.

So, how do you know if your policy is easy enough? Look for these signs:

• Reasonable length of time. One of the biggest factors in returns management is how much time a customer has to decide if they’re going to send a product back.Although you may be uncomfortable with unlimited or even 365-day policies, a 60- or 90-day window will give a shopper enough time to receive their item, open it, inspect it, decide if they’re going to return it and ship it back. Smaller windows can make it hard for customers to make up their minds and also find a drop location, increasing their frustration with your company.
• No restocking fees. Restocking fees are really just a way to punish your customers for not buying a product, after all.Although they were once traditional for electronics, because so many eCommerce retailers offer the same product with no restocking fee, so must you. Think about how you’d feel if you were the customer and a product arrived that wasn’t at all what you expected. Sometimes poor product photos or inflated descriptions can be misleading and those shoppers who cannot accept the differences between their ideal and reality do not want to be penalized for this.
• Free return shipping. There are many ways to make returns easier, many of them revolve around this basic decision. Do you offer free return shipping options? If the answer is no, you need to ask yourself why.Sometimes you simply don’t have the margin, and while customers may be frustrated by that, you should at very least include a discounted return shipping label that makes it easy for them to turn their package around and get it back to your warehouse swiftly.

If you’re unsure of how easy your returns policy really is, give it a try. Order something from your store and then send it back, simply for the sake of experimentation. If you don’t feel like you’re getting enough customer communication about the status of your return or that something about the process is bulky and unnecessary, consider how a first-time shopper must feel.

The post How Easy Is Your Easy Return Policy? first appeared on Smart Returns.

But today, they’re high stakes, with about a 30 percent return rate overall for eCommerce and an even higher 40 percent for returns to eCommerce clothing retailers. That’s serious money for eCommerce retailers of all sizes and shapes.

Returns Can Be Costly, But You Can Fight Back

You’d never dream of throwing away each and every return that entered your warehouse, but when you make reverse logistics mistakes, you might as well be doing that very thing. Instead of throwing goods away, though, you may be practically giving them away or wasting too much time and getting too little money back. As it turns out, you can squeeze quite a bit of cash out of those returns, if you’re willing to rethink how you do things.

Here are a few tips to help your reverse logistics process become far more efficient and far less expensive:

• Stop wasting time. Whether you’re arguing with customers over the reason their product should be returned, forcing customers to wait for a mailed-out return label or using a skeleton crew to process returns, causing them to reach the sales floor more slowly, time is money.Don’t argue with your customers, give them a no-hassle returns policy; stop mailing out return labels, provide those with every order; and whatever you do, make sure there’s enough manpower to return items to inventory fast.
• Start paying attention to your data. If you notice that you have more returns from items that were initially delivered by UPS or your customers keep returning clothing in a particular color, there’s data there waiting to be mined. Today’s business models are just as dependent on predictive data as they are on dollars and cents, if you’re ignoring these valuable signs from your customers, you’re missing out.Too many returns from UPS means there’s a shipping problem there, look at the other information you have to determine if you’d be able to reduce returns simply by using sturdier packing. Lots of returns of related items may point to a problem with how that item is marketed or photographed.
• Don’t handle your own returns. Unless you have a huge warehouse facility and space for a team large enough to both process returns and explore routes for repairing or reselling items that still have some value, you’re probably missing out on a lot of money from the potential reuse of your less retail friendly merchandise.It might mean that your team develops relationships with resale shops or signs a contract to sell all your faulty electronics to a particular company for the metals inside, but those products that aren’t 100 percent still have value and there are companies that want them.

No matter how you turn it, reverse logistics mistakes can cost you a lot of money. Instead of leaving cash on the table, get the help you need to preserve as much of the value of your returns as possible. The idea of reverse logistics won’t be nearly so daunting when there’s some profit attached!

The post Reverse Logistics Mistakes Can Cost You Money first appeared on Smart Returns.

Whether that team comes from within your organization or you find extra help from a company that specializes in returns management, the results can spell huge leaps for your customer service.

Why Reverse Logistics Matter to Customer Service

You want to provide your visitors with increasingly good customer service, but there’s only so much you can do if you continue to focus your efforts at your front end, where orders are processed, and ignore the back end, where they’re returned or corrected.

In a recent white paper by McKinsey & Company, online customers revealed that they continue to rank the returns process among the most important. That being said, these are just a few ways that good returns management can influence your customer service and your bottom line:

1. Giving customers credit for their returns sooner. One of the most frustrating parts of returning an item to many shops is that it can take an impossibly long time to get credit for items that have never been worn or even opened.Often, customers return items that are simply the wrong color or size and want an immediate replacement, not to have to wait indefinitely to replace a gift or special purchase. A faster reverse logistics response means a faster credit and a much happier customer.
2. Making customers feel like you’ll be available to fix their problems. Many online shoppers are wary of eCommerce stores that either don’t have clear returns policies or have terrible reputations for returns handling.It’s not as if they go into transactions assuming things will go badly, but sometimes a product arrives damaged and it’s no one’s fault. A strong commitment to reverse logistics as a part of your customer service effort goes a long way to repairing damaged customer attitudes and enticing new shoppers.
3. Ensuring a smooth returns process. Returning a product through the mail is one of the most frustrating things ever. A shopper has to find a place to drop the parcel, possibly even having to arrange home pick-up if they’re a busy mom or have a disability that makes it hard to get in and out of the house on a whim.Once the package is on its way, that same customer is watching for updates breathlessly until the day it finally arrives at your building and you give the customer a credit. If you can create a hassle-free experience by doing things like including a free shipping label and allowing shoppers to return their items directly to one of your stores, you’ll decrease the hassle factor inherent to returns and create happier customers.

Reverse logistics and your customer service aren’t separate things, they should really be regarded as two sides of the same coin. After all, you want your customers to be happy whether they’re buying or they have the misfortune to need to return an item. Both can be accomplished with ease and grace, but you’ll need to focus hard on having those mechanisms in place now before it’s too crazy to add anything new to your system.

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