With many businesses, order fulfillment does not just end with the delivery of a product at a customer’s doorstep. Some orders may be returned and require a significant amount of processing time and labor, including product handling and reimbursement. Returns can cut down the profitability of a business and if not handled correctly, they may result in loss of customers. Every returned product requires businesses to account for:
- Cost of the return shipment
- Storage space
- Disposal of returned and damaged items
- Claims processing if the package was lost or stolen
- Negative customer review and loss of a customer
Returns are an inevitable part of growing and scaling a business, and if seen as an opportunity to learn from previous mistakes and a chance to improve, they may even prove to be beneficial. Research has shown that a high ratio of customers tends to keep shopping from a business that offers an easy and hassle-free returns experience.
What is an eCommerce Returns Management Process?
Often referred to as ‘reverse logistics,’ the returns process is designed to appropriately handle returned products and reimburse customers accordingly. Some customers are offered an equal exchange while others get a full refund, and the returned items are handled according to the condition that they are in.
If a product is in sellable condition, it is added back to inventory and the status is updated. However, if it is damaged, it may be trashed, recycled, or donated depending on the company’s policy. The returns management process mostly follows a simple three-step routine that may or may not be refined to meet the unique needs of a business and its customers. These three steps are:
- Customer’s initiation of product return
- Receipt of the returned product
- Processing of the returned product
How Can You Stay Profitable with your Return Management Process?
Seeing product returns as a way to improve your current processes, product quality, and customer service can actually help you make your business more profitable in the long run. Here is how you can make that happen.
Upgrade Your Inventory Management
In recent years, returns have become very frequent. This calls for greater efficiency in updating inventory records meaning businesses must quickly update what’s back in stock in case products are returned in sellable condition. Investing in good inventory management software that enables you to manage your stock in real-time will pay off.
Improve Customer Support
To improve your brand image and nourish customer loyalty, find ways to improve the customer support offered by your business. Building a customer-friendly returns process is key to keeping your customers coming back.
Train Your Team
Train your entire staff to follow SOPs and try their best to reduce returns by offering great service. Also, provide your employees the necessary training and practice required for providing a seamless returns experience whenever a customer initiates one.
How to Prevent or Reduce Returns
Seeing the returns process as a learning and improvement opportunity can help you fix the issues at hand, save your business from losing customers and profits, and ultimately reduce returns.
- Provide detailed and clear product descriptions with accurate HD photos.
- Test your products regularly to assess them for quality and to identify any issues regarding the quality of production.
- Extend your return time window to lessen the urgency for customers to return a certain product.
- Identify trends and patterns in returned products to track items that are returned more frequently than others. Doing this will help you tackle the root cause.
What is the Standard Template for eCommerce Return Policy?
While there is no single model for a standard return policy, a general eCommerce return policy template can have you headed in the right direction. You can fill in the unique brand information of your business in the brackets within the template.
General Template for Returns
Thank you [Customer Name] for shopping with [Your Business Name]. If you are unsatisfied with your purchase, you have [X] days starting from the date of your order to initiate a product return. However, for return eligibility, the product must be unused and in the condition that you received it. Your returned product [must/need not] contains the original packing slip for acceptance.
Shipping Requirements
Dear customer, you [will/will not] be responsible for covering the cost of return shipping. To print a return shipping label, you may [email us/click on our link/fill out the attached form].
Refund Requirements
You will be given a refund in the form of [a gift card/credit to your original payment method/store credit] within [X] days of our team receiving your return. Return shipping costs for the original order [are/are not] refundable, so it [will/will not] be deducted from your refund.
Key Takeaway
The final verdict on eCommerce return policies is that businesses must clearly state their policy on their eCommerce store website, as most customers browse for the policy before they make their first purchase. Develop a policy that makes the returns process simple and straightforward but will still pay off by building your brand image and customer loyalty. If you want to learn more about returns management, shipping strategies, and fulfillment optimization, you can read our informative blogs or discuss with a fulfillment expert about how 3PLs facilitate your returns management process.
