RISING TO INCREASING DEMANDS DURING PEAK SEASON Introduction For retailers, early January does not mark an end to peak season but rather a mid-point. In the USA, January 2nd is now even being dubbed as ‘National Returns Day’ as it sees the highest volumes of returns each year. Following the online shopping sprees of the holiday period, from Black Friday and Cyber Monday in late November to Christmas and other festivities in December, January plays host to peak season for returns. During the first month of the new year, retailers and reverse logistics services are met with an enormous influx of parcels to be returned and redirected to various end destinations. This is a hectic period that holds many challenges. Yet, peak return season also holds opportunities as it’s a chance for retailers to demonstrate to their customers that no matter the time of year, their returns will always be managed accurately and efficiently. There is no better reason to secure a robust returns solution than the increasing demand of post-holiday peak season.
Challenges of Peak Season The main and overriding challenge of peak season is simply the sudden and intensive rise in the volume of returns which affects the day-to-day of postal carriers, warehouses and transport, to name but a few. As, year-by-year, online shopping increases in popularity, the nature of returns during peak season is continually influenced by consumers’ shopping habits. As more shoppers than ever make purchases online, the return of these products can exceed returns to store by more than double. These volume increases affect many, if not all, areas of the reverse logistics process. For example, transit times may increase causing a delay to a returned parcel’s onwards journey, whether that be to warehouses, reconditioning facilities or back to store.
At every step of the parcel’s journey, delays are a risk due to the higher volume of returns being processed at each stage. Issues such as delays may have a direct effect on customer satisfaction, which for retailers is a primary concern. The rising demands of the modern consumer, caused mainly by the ‘amazoneffect’, means that shoppers expect their returns to be as easy, quick and seamless as buying a product online. That’s why, for brands and retailers, it is essential for their operations to have a robust returns solution in place. Offering a positive consumer experience during the holidays and peak season is key to securing loyal customers and returning shoppers.
Meeting Consumer Expectations To make a success of peak season, retailers must secure a seamless returns solution. Cycleon is a trusted partner for retailers, managing returns end-to-end globally. As such, we feel able to advise on what key elements secure a successful returns solution, not only during peak season, but throughout the year. Automization throughout the returns process immediately ensures a quicker, more efficient and secure reverse logistics operation. Digital portals, for example, provide a one-stop-shop for all participants to access data about each and every return. Warehouse staff, customer service representatives, retailers and returns management partners such as Cycleon, all have access to easy and transparent data regarding returns. Additionally, these portals can be integrated with retailers’ own systems, only further optimizing the data-sharing that is key to an efficient returns process. Additionally, the data pulled from value added services, such as the grading and reporting of items, may be used in tandem with smart routing. Using data to smart route returned items not only saves time but also money for retailers. This is because the profit margins of returned items may be retained by redirecting stock to where it holds the highest value. This can be locations such as back to store, or reconditioning and recycling facilities, to name but a few.
It is also important for retailers to offer their shoppers omni-channel returns to maintain a high level of customer satisfaction. Cycleon recommends that retailers offer their consumers as many returns options as possible to match the many options they have when ordering online, such as click & collect, in-store pick-up or home delivery. Making returns as easy as purchases will go a long way to securing a loyal customer base, especially when this is available during the busiest time of the year. Although there will always be higher volumes of returns during peak season, retailers can minimize the likelihood that products will end up as returns even before a customer purchases them. Enhanced product descriptions, size guides and accurate photos of items can lead to reduced returns by managing customer expectations. What is seen online, should match what is delivered to the customer, therefore eliminating many reasons for returning products such as sizing or color issues. Additionally, changes to return policies may also influence return volumes. For example, customers offering longer return periods may see products being returned at a more staggered rate, decreasing the busyness of the weeks in December and January.
Conclusion Peak season changes each year depending on what returns policies retailers make or amend during the busy period. Retailers that encourage a lot of spending during this time with heavy discounts and offers, can expect higher returns volumes. Whereas sellers that offer a longer returns period, may see a more staggered pace of returns following peak. In either case, December and January are the busiest months of year and the most important time for retailers to secure a solid returns solution to maintain good operations and keep high customer satisfaction levels.
References: https://www.supplychaindive.com/news/ups-26-jump-returns-peak-season/566537/ https://www.rejournals.com/online-returns-could-take-$41b-bite-out-of-holidayearnings-as-reverse-logistics-20191231 https://www.freightwaves.com/news/2017/12/28/january-is-peak-season-forreturns-and-reverse-logistics https://www.themds.com/markets/online-sales-are-ascending-but-so-are-returnsreturn-shipping-costs-are-now-a-customary-necessity-for-retailers-and-brands-todo-business-its-expected-2-million-returns-for-one-carrier-alone-on-january-2.html