Self-Evaluating Your Returns Management Methodologies The path to “returns enlightenment” begins by understanding where you are in your current approach and then comparing your position to where you want to be. This is not as simple as it may sound given the complexities involved, such as disparate data and metrics, change management, shortage of labor, and organizational disruption — just to name a few. A good starting point is to honestly agree or disagree with the statements below. Keep in mind, there are no “right” or “wrong” answers since these statements are merely to help you understand your current position. We have staff dedicated to returns management or outsource this function. We know our true return cost components (soft and hard): Items like labor, customer service, space, transportation, cost of money, inspection handling, restocking, customer friction (loss of future orders), etc.
We monitor the return’s cost impact by time periods, customers, trends, etc. We have analyzed our reverse logistics network model in the last 12 months to optimize the facilities network and zones/distances where returns are sent. We can determine optimal disposition methods while adhering to the returns mandates of our clients/brands. Our company focuses and monitors the cycle time of a return just like we do on the speed of fulfilling an order. Our 3PL (if utilized) knows how to do returns and we understand how they bill us for these returns. We communicate with shoppers across the entire path-to-purchase and path-to-return. We are reviewing or revising our returns policies every six months. Our sustainability efforts are integrated with our returns management.
Keeping Returns Costs in Check There are traditional ways to lower the return costs, such as negotiating parcel rates and altering your return policies. Other, non-traditional cost containment measures include shortening return zone exposure, refining inspection processes, improving returns technology, or outsourcing the entire returns management process. Additionally, decision support systems can increase the quality and speed of decision-making. These intelligent systems balance costs with benefits, which is critical as parcel, warehouse space, and labor costs escalate at unprecedented rates.
Michael Foy is Director of Business Development for Inmar Intelligence. He can be reached at email@example.com. He will be speaking more on this topic at this year’s PARCEL Forum on September 15.
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PARCEL September/October 2021