You love your business, but you hate dealing with returns. You are not alone. If you are like most, dealing with returns has consumed too much of your time, is constantly challenging, and somehow presents new dilemmas to solve on a regular basis. It drains you and your company’s energy, and you want this year to be different.
Without a doubt, if returns are not properly managed, they can be a tremendous source of stress and uncertainty and, simply put, something you wish you could did not have to deal with.
But, part of the issue may be that you lack a solid strategic plan to manage, track, and quickly resell your returns. When you get this aspect of doing business under control and managed well, the heavy responsibility suddenly feels lighter, and you can be more assured of obtaining your ROI.
If this sounds like a fantasy, you should know that many successful companies, in fact the most successful ones, get their returns under control and tap into maximizing ROI. They secure an experienced third-party provider to partner with them and create a plan that is tailored specifically to their business.
A provider can focus the time required to do this successfully, giving returns continuous oversight, and even offer sales expertise for this important task. By turning the focus on value recovery and improving your reverse logistics strategies, your worrisome product returns could actually become a source of profit to boost your bottom line.
Is a Third-Party Provider Right for Your Business?
Time Really is Money: The fewer times an item is handled, the faster it can reach its end destination, where value can be recouped. You need a simplified reverse logistics process because the longer it takes to manage your returns and resell them, the more they negatively impact your bottom line. One report suggests that improving the return velocity (the time from return notification of product to actual arrival at repair site) can allow a company to achieve millions in additional savings over the previous year. If you can adjust and improve any of the components of the cost-saving equation (the creation, handling, processing, and final disposition of a return item), the total reverse logistics costs can be reduced, ensuring the biggest return for the money or time invested.
What can a provider do? A provider can lower your logistic costs and handling, using a centrally managed location. They can provide sales reports that allow you to determine your ROI, breaking down the information by individual item, model number, category, or price point for analysis. They can also swiftly handle your warranty returns, while allowing you to see the results of the product testing and to follow the progress of the product as it gets refurbished, remarketed, or sent back to you. They should provide you with detailed status reports that convey in-depth technical information, including quantity, condition, serial number, defect (if applicable), and included and/or missing accessories.
Marketing Expertise is Required: You need to be marketing through the proper channels, the ones that your potential customers are on. The fact is, the same basic principle holds true for marketing and remarketing: you need to be where your customers are. According to MIT Sloan Management Review, an average-sized company can lose up to 50 percent of its returned inventory value if it fails to effectively take advantage of the correct secondary sales channels. What can a provider do? Your provider can partner with you to identify the disposition channel that yields the highest return for each asset. Online channels like eBay, Amazon, Rakuten, and other popular platforms are effective for resale. If you do not excel at navigating all the moving parts of e-commerce, you are better off hiring a high-quality third-party logistics service provider that can take the task off your hands, allowing you to focus on what you do best.
Customer Service Counts: The ease with which customers can make returns or purchases will be reflected in your revenue. Also, the professional appearance of your online store can either bolster or negatively impact your company’s branding. One study revealed that inattentive or poor return experiences in the online marketplace resulted in as many as nine out of 10 customers taking their business elsewhere. What can a provider do? Your provider should have an excellent rating and offer superior customer service in which to draw more traffic to their storefronts and increase your sales. Studies prove that customers are willing to pay more for products that are presented in professional manner and sold by top-rated sellers.
By partnering with an experienced reverse logistics partner, you receive customized solutions to manage your returns efficiently and to achieve the maximum possible ROI. Their services should include LEAN quality control, data security, 4-point product evaluation, and smart merchandising to ensure the highest recovery value, allowing you to focus on other important aspects of your business.