How Much Will Returned Products Cost Retailers?

Man checking list of items

National Returns Day (NRD) in the U.S. usually occurs after Christmas, but an analysis shows that things have become more different for retailers. The increasing use of e-commerce partly influenced the influx of returned shipments.

On Dec. 19, retailers handled as many as 1.5 million returned parcels based on an analysis. It marked the first time that NRD took place before Christmas. This typically happens in early January after the holidays, but now it seems that consumers have no second thoughts on sending items back to retailers. As a result, businesses need the services of a reverse logistics provider such as ReverseLogix to minimize the costs of handling merchandise returns.

Why Reverse Logistics Has Become More Important

A reverse logistics service helps businesses manage the expenses from returned shipments. Being able to optimize product returns is important especially for this year’s holiday season when Americans are expected to return an estimated $94 billion worth of consumer items. Most of the products can be resold or repurposed, so making sure that you can maximize those returns is important to reduce the impact on business.

The associated costs generally refer to the transportation and sorting of products. Some items aren’t suited for product returns, such as flammable objects and groceries. Your business policy would have to strike a balance between accepting and rejecting returns to protect your bottom line and retain customers at the same time.

Customer Satisfaction Is Key

Woman signing a box

The reason behind a fair returns policy has to do with changing consumer habits. Most people no longer become attracted to discounted prices as they are more interested in how they can return a product if there are issues with it. In fact, almost 80% of online shoppers will not buy anything without reviewing your return policies beforehand.

An additional 1.3 million packages are expected to be returned on Jan. 3, 2019. As early as now, it’s advisable to become accustomed to more merchandise returns in the near future.

Returns Might Be More Common in 2019

An easier returns process serves as one reason why more people have no qualms on sending items back to retailers. Several businesses have made it easier for their customers since this is part of their strategy to entice more customers to buy products on their online stores. Some are even willing to ignore the high price to pay for returned items if it means keeping their loyal customers and having new ones.

The trend in 2019 might be no different. Competition has become even tougher for retailers, and their customers know that it’s easy to take their business elsewhere if they are unhappy with the service. All of this should somehow convince retailers to invest in a reverse logistics service.

In the end, Christmas might be over, but you can continue to notice an uptick in product returns coming into 2019. If you’re still thinking about having a better reverse logistics strategy, you should consider consulting a third-party logistics provider that specializes in different services aside from returns management.