Peak season is upon us, bringing both the joy of a sales surge and the headache of fulfillment chaos. And if you’re a busy 3PL who’s been around the holiday sales block a time or two, you know the craziness doesn’t end on New Year’s Day. You still have post-holiday returns season to look forward to.
The good news is, if you’re looking for ways to position yourself as a better partner to your retail customers, helping them optimize their returns management is an excellent choice. Easing the flow of returns back into inventory (or a donation center) saves you and your customer time and money.
Returns Are a Costly – and Tricky – Problem
According to the National Retail Federation, the average retailer loses $166 million in returns for every $1 billion in sales. Altogether, that means adds up to more than $760 billion in lost sales across all retailers.
Adding insult to injury, only about 48% of those returns can be resold at full price, according to Gartner – and around 10% don’t make it to resale at all. During the holidays, when hectic shipping schedules and increased customer demand for fast shipping strain retailers to their limit, products have a higher risk of arriving to the end consumer damaged, or getting damaged on the return trip to the retailer.
Either way, that damaged product creates an unhappy customer and an added expense for the retailer.
Another issue you may run into around the holiday season is bad actors taking advantage of the higher order volume to request fraudulent returns. Packing a box with an item they didn’t purchase from that retailer, or returning items not eligible for return, are just two common tactics. During busy season, when returns processing might not be as high on the priority list, retailers may miss these dishonest returns until they’ve already issued refunds.
Tips to Avoid the Most Common Returns Pitfalls
If you offer returns management as part of your 3PL service package, you can help your customers minimize the costs of products coming back from consumers. Here are a few of the top strategies to recommend to your customers:
Make your return policy clear and simple.
Forbes reported in 2020 that 66% of consumers read a return policy before placing an order. And 95% of online shoppers surveyed by Narvar said they’re more likely to buy from a retailer again if the return experience was positive.
During peak season, you already have enough to worry about without unclear return policies increasing the volume of customer calls and questions. Publish your rules clearly on your website, order confirmation and follow-up emails. You also need to make your contact information readily available so customers know where to call if they need to return something.
Give customers multiple ways to return their orders – whether that’s return shipping or in-store returns for items bought online. While no retailer wants to encourage more returns, making the process easier boosts the brand’s reputation and makes customers more likely to buy from that store or website again.
Prepare in advance for returns.
Making it easier for customers to return items (and for your team to process incoming returns) involves a little pre-sale planning. For commonly returned items, include a return shipping label with the order so the customer doesn’t have to print one manually. This can help you save on return shipping costs, and also gives you the opportunity to include easy scannability of the package for your returns management system.
Some retailers even send orders in reusable, reversible shipping envelopes. When a customer needs to return an item, they turn the envelope inside out, reseal the item inside and put the included return shipping label on it. This not only eases the return process for the customer, but helps save shipping costs that might come up due to customers packing items in larger boxes that incur added fees.
Avoid late deliveries with expedited shipping options.
Items that arrive after the holiday are no fun for anyone – retailer included, since they’ll have to field the call from a frustrated customer. Trouble is, lots of consumers are last-minute shoppers – and many are happy to make their lack of planning your problem.
Minimizing this issue starts with publishing shipping cutoffs prominently all over the retailer’s website, so consumers know how long they can procrastinate before risking their big holiday surprise. Also important: offering expedited shipping options at checkout. If your 3PL services include same- or next-day shipping, make sure your retail partners know about those options and can advertise them to customers.
Ensure enough warehouse space for both outgoing and incoming orders.
Keeping enough inventory on the shelves is one issue retailers face during peak season. Having enough room to receive, stage and process returns is a whole other challenge.
The good news is, scalability is your superpower as a 3PL. With a clear return policy from the retailer and an optimized returns process on your end, you can handle incoming returns efficiently. Saving retailers time and money on their returns makes a good selling point for peak season – and beyond.
Returns processing doesn’t have to be a major headache. By putting a plan in place and implementing robust returns management solutions, you can offer your retail partners their most wished-for gift this season: happy customers.