TradePort Blog

Tips for Smoother Amazon FBA Returns Management

Posted by Sam Biddle on May 24, 2016 4:00:00 AM

For many e-commerce retailers, one of the largest challenges of doing business today is dealing with the chaos caused by returns. If you are struggling with the reverse logistics process and the result is an ongoing battle to meet your goals, primarily because of return policies, it is time to rethink your strategy.amazon.com_pic.jpg

In the last few years, there has been a tectonic shift in the way consumers shop and buy. According to a Forbes report, today’s consumer perceives shopping in an actual brick-and-mortar store as a time-consuming task that can be avoided with a few clicks of a mouse or a few taps on the cell phone. Over 100 million people in the U.S. shop via their mobile devices on a regular basis, and that number is expected to continue to grow each year.

In fact, from 2008 to the 2016, online sales have skyrocketed by 40%. Another study, published by MarketingProfs, shows that 68% of U.S. consumers say they shop online at least once per month, which is up from 62% a year ago. Without a doubt, more consumers are doing their shopping online, and many are attracted by the generous returns policies, like those found through Amazon.  

But, Fulfilment by Amazon (FBA) sellers do not typically find these customer-friendly policies easy to manage. In fact, though FBA offers numerous benefits, it also presents several obstacles. The good news is there are solutions that allow companies to easily navigate these obstacles and transition their reverse logistics chaos into a smooth, well-managed operation.

Sounds too good to be true? In a nutshell, if FBA returns create an ongoing challenge for your business, you can partner with a qualified 3PL provider that will deliver a unique multi-channel returns solution. This partner should possess experience in implementing strategies that create efficiency and maximize the value of returned inventory, essentially transforming the way you process returns.

Here are few FBA headaches that a 3PL provider can resolve:

  • For those using FBA, you are dealing with the most flexible returns policy around — essentially accepting nearly all returns. So, if your company lacks a dedicated team or facility to process returns, inventory and cash flow can stagnate. The right 3PL provider can remove these roadblocks by having a specialized receiving team ready to inspect, test, and grade each item to ensure maximum value for resale.
  • Your warehouse space is drowning in a sea of returns. Ideally, your provider can receive all returns and excess inventory — both manifested and unmanifested — directly to their facility. This frees up your warehouse space and eliminates the need for extra warehouse employees to receive items. 
  • Amazon has a complex removal process, which requires a relatively tech-savvy receiving team and good data to ensure the receipt of all inventory. Your 3PL provider should have proprietary technology that allows sellers to automate removals, creating a returns management strategy that is efficient and hassle-free.
  • ROI is a top priority, so the right 3PL provider will offer multiple resale options for all types of product inventory. Marketing strategies should range from retail to extensive D2C channels. A provider can offer your company extensive connections and expertise in the secondary markets and should provide wholesale opportunities to your marketing plan.

According to Forbes, online sales, particularly within the consumer electronics industry, is tackling an ever-increasing product returns challenge. One survey discovered that product return rates over the last three to five years has increased for 57% of retailers and 43% of manufacturers. With an expectation of easy, no-hassle returns, today’s online consumer is driving this increase of returns as well as the exponential growth of online shopping.

The Takeaway

If your company is struggling with FBA policies, it may be time to seek alternative methods in managing the influx of returns and to develop new strategies to maximize your resale opportunities. Minimize return inconvenience with a 3PL provider that offers a specialized receiving team to inspect, test, and grade your returns, and also provides a multi-channel solution to maximize efficiency and the value in returned inventory.

Topics: Remarketing, 3PL, Returns, Amazon, FBA returns