In today’s eCommerce era, returns are a way of life for shoppers and sellers alike. With more and more companies launching as direct to consumer brands and the continued growth of the return-intensive try and buy subscription models, it’s imperative to factor returns into the life cycle of products.
At no time of year is this more apparent – and more mission critical – than the holiday and post-holiday period. Now is the moment when online customers are maxing out on Black Friday and Cyber Monday sales, not to mention all sorts of other promotions, and stocking up on gifts as well as holiday outfits and pre-New Year’s indulgences. This overall surge in outgoing orders naturally corresponds to a rise in returns, and how your company deals with this surge can make or break your reputation as well as your bottom line.
As specialists in eCommerce fulfillment and logistics, we’re by extension return experts, going so far as to offer standalone Returns Management Solutions (RMS) to companies who recognize the importance of this component to the success or failure of a broader fulfillment strategy. By harnessing the power of technology and treating the returns process as a solvable challenge that can be leveraged as an opportunity to differentiate a brand, we are able to make each return processed a seamless experience, while maximizing re-sell potential and customer retention.
With our warehouse robots spinning to keep up with holiday demand and resultant returns, and with our team of product specialists working hard to ensure that each incoming item is processed efficiently, restored to first quality and placed quickly back into visible inventory, we wanted to share some essential reading for making it through the season successfully. Building on the basic tenets of a highly effective returns policy, we now offer our top 5 tips for implementing an innovative, forward-thinking RMS that will differentiate you from the competition:
1) Factor returns management into your overall logistics plan.
First things first: returns should not be an afterthought. While this may sound simple, it’s surprising how many brands continue to hang onto an antiquated approach, scrambling to deal with returns after the fact. But with roughly 20-25% or more of all eCom orders coming back to the warehouse (either as a refund or exchange), returns are expected and need to be worked into a comprehensive fulfillment strategy from the get-go. This may be a far cry from the early days of eCom logistics, but it’s most definitely the new norm – any brand that doesn’t get on board with the reality is going to be dealing with some very difficult situations as a result.
To flip that and view it in a positive light: many of today’s most successful online brands have built their reputations on excellent customer service, winning over loyal customers with top-notch return policies and exceptional exchange services. Though the direct to consumer model makes it hard for the customer to experience a brand physically before placing an order, a clear, hassle-free and enjoyably branded returns policy is terrific incentive for the customer to go ahead and order an item without having tried it on first. To make returns equally painless for the seller, and to minimize the detrimental impact on the bottom line, it’s critical to think through everything from returns packaging and shipping to product restoration well in advance, so each component can be weighed in and handled accordingly, with the best possible deals negotiated at the outset.
2) Streamline the overall returns process for the customer as well as your team.
Complication arising from the returns process (confusion about the policy, disagreements over acceptable condition of a returned item, lag time on a refund, etc.) is one of the easiest ways to lose a customer. In a landscape where brands are seeking to differentiate themselves through stellar customer service, it’s more important than ever to define return terms for your customer as clearly possible, and to make sure the entire process is quick and convenient, and in no way a barrier to future purchases.
Start by making sure that your returns policy is written in clear, easily understandable language and covers all the basics: how many days to make the return, what condition is acceptable for a returned item, etc. Make sure it’s located in an easy to find place on the website and on the receipt/order materials. Next, be sure to include a pre-packaged shipping returns label as well as returns packaging – or clear directions on how to repurpose the original box/polybag/container as packaging for the return. Customers won’t want to scramble for a new box, and even the extra step of having to print their own label can be a source of aggravation for the pressed-for-time shopper.
In addition to defining your policy for customers, it’s critical that your own team is up to speed on how to implement the policy consistently and in a manner that is up to brand standards. To maximize the efficiency of the process, have an action plan in place for how each return is handled the minute it comes back to the warehouse, from how to assess an item’s condition to how to restore it for re-sale to what to do with damaged goods to how to communicate with the customer. Anticipating all these inevitable steps will save time, money and complication later on. Finally, make sure you’re automating the systems side of the returns equation by integrating properly with your 3PF. The more messaging done through the system, the less impact on end customer experiences with respect to delays and credits.
The above elements are so foundational to our services that we’ve written about them before, at length. You can read more about all aspects of building a highly efficient return policy here.
3) Insist on sending first quality to each and every customer.
Take it from us: there’s no telling what condition an item may be in when it’s returned to the warehouse. We’ve seen it all… An “easy” return may merely be a little wrinkled or roughed up – a lightly wrinkled garment that needs to be steamed and refolded, for example. Difficult returns can run the gamut – garments that have been tried on and soiled, items that are missing buttons, etc. – and require specialty services. Whatever condition the item is in, it’s essential to have a strong product restoration program in place to ensure that sellable returned items are steamed, re-folded and re-packed to your specifications (as well as a liquidation or disposal process for items that are past repair). Why? Because there is no doubt a percentage of you outbound products will be returned, they need to look like new before getting shipped out to the next customer. No shopper wants to receive something that appears to have been worn or otherwise used, in packaging that is less than perfect.
With first-class order presentation so top of mind, many brands are opting for 3PF partners with value-added restoration service experience and skill. This approach ensures that returned product looks factory fresh again through services like steaming, refolding, dry cleaning, deodorizing, poly-bagging, stain removal, lint brushing and more. This is another area we’re passionate about because we know how impactful it can be for our partners’ businesses, especially at peak periods when products are flying in and out of the warehouse. Learn more about our efficient and cost effective product restoration services here.
4) Restock each item as quickly as possible.
Today’s online customer has near-endless options. If the item he or she wants from your site is unavailable, it’s only a few clicks to a competitor’s page. That’s why speed of processing incoming returns is just as important as outbound fulfillment, and why we make a point to leverage the accuracy and efficiency of our outbound software for both trips. After all, the quicker an item comes back and is processed and returned to visible inventory, the faster it can become available to the next customer. While a traditional take on logistics can place lower priority on this half of the equation, or allow returned stock to languish, this innovative, holistic approach is the key to maximizing sales particular at peak holiday season but also all year round.
Moreover, as omni-channel solutions evolve and expand, another challenge arises: where do we send returned items shipped from stores or multiple fulfillment centers? With returns management becoming a bigger inventory control challenge, it’s more and more essential to consolidate returns processing as well as replenish stock to the origin destination most strategically in need. Here’s another reminder that carefully selecting a 3PF partner with outbound competency and software that can manage inventory and distribute across multiple destinations, plus proven returns processing and product restoration capabilities, can make an enormous difference and help relieve your pain points.
5) Consider outsourcing RMS, even if you’re in-sourcing outbound fulfillment.
Even brands that currently in-source their fulfillment can benefit from handing over the mission critical returns process to a skilled and experienced third party. Depending on your brand’s products, business strategy and customer service, outsourcing RMS can lift a huge burden. Returns require specialty services, ones that are often time consuming as well as highly exacting: there is a big difference between preparing a mint condition, factory fresh item to ship and reconditioning that product to make it look and feel good as new.
By passing this part of the process along to an expert team, you can ensure optimal order presentation via professional product restoration services, thus increasing the potential to resell each item to a new customer. And by choosing a RMS partner with high-tech systems, you’re guaranteeing maximize efficiency when it comes to customer service and restocking inventory.
Learn more about our new returns-only management services.
Of course, it’s key to work strategically with your internal team and 3PF provider to minimize the likelihood of returns in the first place, via A+ sales and marketing, informative sizing guidelines, accurate product descriptions and so on. But even in the best-case scenario, returns are inevitable. By thinking ahead and anticipating the needs of your customer as well as the demands returns place on your team, you and your RMS partner can implement a first-class, digitally savvy solution that builds long-term customer loyalty while burnishing your brand’s reputation.