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Earlier this month we spent some time reviewing the importance of making your Reverse Logistics processes sustainable. However, one of the challenges many businesses have to start down that path is the relative lack of scrutiny in the Returns area relative to other process areas which we’re much more in tune with all the levers impacting our KPIs there.

To address this, it’s worth spending some time in your Returns area and really going through every bit of it, step-by-step like an outside process consultant would – ask all the dumb questions (“Why do you do THAT?” or “What is that thing for?” and “Do you get a lot of those?”).

Let’s look at breaking down the Returns process in a more manageable set of smaller pieces (or “subprocesses” for the more formal among us), and for some of them, we’ll even include some of the dumb questions you might need to get you started!

Return Process Bits and Pieces

To look at where the Reverse Logistics process can be made more sustainable, start by breaking down the Returns process into smaller pieces, starting from the moment the customer receives the product, and you can see how many simple choices already exist:

1. Return Instructions/Forms – Some retailers still provide a paper insert in order to initiate a return (Really? Yes, but not shaming them here). Or can they print a form at home, or is there a digital only option from the website, a QR code on the receipt – or something else? What makes it easiest and least wasteful for you and the customer?
2. Return Packaging – Does your packaging make it easy to return using the same box, bag or something else? Is a box even required, or can they drop it off at a UPS Store or other retail location? Do you track comments on your packaging? If not, take a peek to see if your packaging is creating a negative perception among some of your guests.
3. Return Dropoff/Pickup – how far does your customer need to travel to drop it off? Do you designate specific drop-off locations that require more miles driven, or do they have multiple options (i.e. closet US Post Office, UPS Store, Fedex, etc.)? If you have higher-end products it can even be more sustainable to have an option to have them picked up at the door by a delivery vehicle that would be passing through the neighborhood doing deliveries anyway – for a charge.
4. Return Shipping – do you designate a specific shipper or shippers or do you funnel returns to designated centers for processing? How do they aggregate or bundle the returns? More packaging, plastic bins, rolling cages, etc.?
5. Returns Intake – how efficient is your ‘receiving’ process for returns? The sorting, opening, classifying and prepping for assessment is another opportunity for efficiency gains. If you need to have an up-front separation for certain categories of products (i.e. consumables/fresh vs. durable items that can be restocked), then embedding a code on the package label could speed up the subsequent steps by simplifying the initial sorting.
6. Returns Assessment/Assignment – do you have a team trained on how to evaluate the condition of your products? The more accurate your assessments the less costly it is for your business by being able to restock items vs. knowing when they need to be taken out of circulation. Clothing retailers, for example, have people trained to smell the product – and determine if it belongs into a number of categories – never worn, worn not washed, washed, etc. which determines if the item can be restocked, moved to clearance or disposed of.
7. Returns Repackaging/Labeling – this MAY not be a function of your Returns team, but having the resources ready to efficiently prep products to go back on the shelf will improve your velocity to resell them. Ideally, the coding on the incoming return will precisely identify the product and once a status is assigned to it the Returns team can just print the new label and send it on to its appropriate destination.
8. Returns Restocking/ Disposal – In an industry where nearly every survey we do comes back as “not enough space” being a perennial issue for DC managers, velocity matters in Returns as much as any other part of the operation. Quickly getting returns back on the shelves or disposed of to their next destination is a matter of keeping space clear and inventory up to date. NOT doing so means either having a Returns area larger than it would need to be or one that is very cluttered and consequently mistake prone.
9. Returns Waste Disposal – One of the most critical areas for “Sustainability”, HOW you dispose of your incoming waste will make a difference for ‘sustainability’, but with the caveat that it may cost you more than sending everything to landfill. Make point of ensuring what you send OUT is sustainable, AND re-usable for the returns process as well. While you can’t prevent customers from grabbing the old plastic bubble wrap they were saving or using 15 polystyrene shopping bags as insulation in the styrofoam cooler they sent wrapped in duct tape, you don’t have to provide the materials that would result in that!

Getting Started

Where to start? Ask yourself the initial “dumb questions” which is about learning what you actually know and don’t know about how your Returns operations work. Meet the people who know more than you, then get out on the floor with your list and ask all the questions, take all the notes, and listen to all the ideas. Like most parts of your warehouse, there will be plenty of individuals who will have insights that no one has heard, or even asked about.

And given how eCommerce experience as a consumer is almost universal now among our customers, it is easier than ever to relate to the “customer experience” because most of us can understand the experience our customers go through since we share many of the same experiences as consumers ourselves – something that was not as common 10-20 years ago.

5 Tips to Improve Your Warehouse Returns Process