Top 10 Reasons to Rethink Merchandise Returns Processes
ReturnBuy
is offering research critical to retailers, distributors and manufacturers for
improving their returns processes - an aspect looked at traditionally as just
a necessary cost of doing business.
"Returns have long been under-managed in most retail environments," said Walt Shill, President and CEO of ReturnBuy. "However, new competition, increased pressure on margins and greater customer demands require that retailers now take a fresh look at the hidden costs and lost opportunities of handling returns in the traditional way."
The following is a sample of the new industry research now available from ReturnBuy, and represents the top ten reasons why retailers, distributors and manufacturers should rethink their returns processes, especially during and after the busy holiday season:
1. Returns as a Competitive Advantage. Retailing has become even more competitive, so therefore, every opportunity should be taken for bottom-line improvements. Returns have the potential to be one of the greatest untapped sources for increased revenue and customer loyalty.
2. Returns: Not Just a Necessary Cost of Doing Business. Returns have traditionally been considered just a necessary cost of business. However, the costs associated with returns are far from trivial when all of the hard and soft costs are calculated to determine true business impact.
3. The Traditional Liquidation of Returns Channels Are Slow, Inefficient and Costly. Recovering value from returns is a difficult task through the traditional liquidation channels. Although these channels are widely used, they lack ease and efficiency, and the end result for merchants is the recovery of a mere 10 to 20 percent of cost. Products lose value at every step to final disposition.
4. Returns Contain a Wealth of Information on Products and Merchandising. Returns offer an immense amount of information about consumers and products that few retailers and merchants capture. For example, returns can provide information about the original merchandising, actual product performance, ease of use, product defects and consumer expectations.
5. Return Rates are Higher than Ever. Return rates are high and climbing, especially for online merchants who are experiencing increased return rates as a result of trial and impulse Internet purchasing. Calls and traffic to customer service also increases as online buyers, in particular, expect fast credits and refunds.
6. The Cost of Returning Items to Vendors is Ultimately Absorbed by Retailers. Retailers in many industries simply return products to distributors, who in turn search for other channels or return products to their suppliers. Sending more products back to manufacturers results in necessary price increases to their customers, the distributors and retailers.
7. Do Third Party Logistic Providers Handle Returns Efficiently? Some retailers have successfully outsourced fulfillment and logistics functions to third parties for better service, lower costs and increased flexibility. However, few of these providers have yet to develop the special processes or to make the incremental investments necessary to handle returns efficiently.
8. Customer Loyalty has Become Increasingly Rare. Merchandise returns are a unique opportunity to engender fierce customer loyalty. L.L. Bean and Nordstrom's have used their liberal return policies as a powerful way to attract and retain their customers.
9. The Growth of Online Retailing is Undeniable and Inevitable. In 1999, Forrester Research estimates a growth rate of seven million new online households. By 2001, they anticipate that more than half of U.S. households will be online, and one-third will have purchased online.
10. Taking Full-Advantage of New Returns Technology is the Key. New technologies and service providers have emerged to address the increasing demand for better solutions in returns management.
About ReturnBuy
ReturnBuy is the first company to use technology to create new dynamics for
the returns industry. ReturnBuy's solution is simple - instead of shipping a
product back to the retailer, a consumer sends the item to a ReturnBuy processing
facility, sparing retailers from inventory-clogged storage rooms. ReturnBuy
then evaluates the product's condition and resells it through a variety of resale
channels, including Internet channels such as eBay and Yahoo! Auctions. ReturnBuy
is headquartered in Ashburn, Virginia, and operates nationally through its facilities
in Virginia and South Carolina. For more information visit www.ReturnBuy.com/business.
New service providers and new technologies now offer an opportunity to completely redesign the returns process. ReturnBuy is offering its complete white paper entitled, "The New Dynamics of Returns." This research is worthy of serious attention by senior management or by leaders in retail, providing a concise perspective on the issues they face. For a copy of the white paper, or for more information on their innovative process, contact ReturnBuy at 800/347-8616 or WhitePaper@ReturnBuy.com.
SOURCE: ReturnBuy Press Release,
December 14, 2000
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