Reducing Costs of Returns in the Omnichannel Supply Chain

The simple fact of the matter is that any customer-facing organization must support the ideology of processing returns; whether or not that process can be efficient and productive comes down to how returns are handled.

Omnichannel Returns

According to Forrester Research, the adoption of ecommerce solutions is accelerating, driven by the advantages offered by Omnichannel strategies.

So much, in fact, that Forrester is recommending business-to-business (B2B) and business-to-consumer (B2C) businesses embrace an omnichannel strategy - one that offers several significant benefits to both retailers and wholesalers alike.

Technologies Must Support The Customer Journey

Download Mastering Omni-Channel B2B Customer Engagement

Source:Elevate Omnichannel Customer Experience With Continuous Business Services,” Forrester Research

In essence, omnichannel adoption can tear down silos and reduce operational overhead while bringing more opportunities to businesses looking to sell products and services.

However, omnichannel solutions are still plagued by supply chain inefficiencies that can reduce value and hamper productivity.

Take, for example, that returns management process, where defined methodologies for handling customer returns have become high-touch processes that can introduce delays, inefficiencies, and mistakes - all of which can impact the bottom line while also affecting the relationship with the customer.

The simple fact of the matter is that any customer-facing organization must support the ideology of processing returns; whether or not that process can be efficient and productive comes down to how returns are handled.

Retailers and wholesalers often view returns management and reverse logistics as necessary evils, and attribute processing returns to the costs of conducting business.

However, consumers see returns as a natural part of the shopping experience. While the business view and the consumer view may be diametrically opposed, there are plenty of opportunities to improve the process for both.

Unifying Data via Supply Chain Systems

An organization cannot improve returns management without relevant data. Unifying data via supply chain systems goes a long way to improving the return processing narrative. Simply put, if a single database is used to record all of the transactions, the issue of determining the original processing channel can be eliminated. More simply put, channels and transactions become symbiotic, meaning that returns can be more easily processed and reconciled against the original transactions. With omnichannel systems, sellers are able to quickly retrieve transaction information, although the original sales channel may not be known at that time. That capability makes it possible to better execute the reverse logistics associated with returns.

When sellers are able to process returns using the original purchase data, they can create a seamless experience for customers and eliminate reconciliation errors on the back end. What’s more, leveraging the original purchase data automatically reconciles the original purchase price, including discounts or coupons, with the amount to be refunded. Additionally, the integrated nature of omnichannel helps to prevent fraudulent returns, and the native tracking aligns inventory data with real-world availability while also enabling merchandise to move into the reverse logistics supply chain swiftly.

Download Returns in the Retail Supply Chain with a Specific Focus on e-Commerce

Aligning data goes a long way toward reducing the costs of returns processing, while also potentially improving the customer experience. Yet, processing returns still remains a high-cost proposition for the retailer. Much of that cost can be attributed to the high-touch nature of returns processing, where individuals have to handle the merchandise, interact with customers, inspect the merchandise and ultimately determine whether or not the merchandise can be restocked, returned to the vendor, recycled, repaired, donated or liquidated.

Intelligent Disposition

Bringing innovation to returns management through “intelligent disposition,” where retailers adopt technologies such as machine learning, data science, and real-time processing, drives workflows while increasing the bottom line. What’s more, the adoption of intelligent disposition brings with it additional capabilities that reduce the amount of touch needed when processing items.

For example, intelligent disposition uses deep learning, which interacts with market data to improve real-time decision-making at every touchpoint throughout the supply chain. With smart touch technologies, automation can be used to determine where returns should end up. This level of automation paired with artificial intelligence (AI) decision-making helps to streamline the reverse supply chain, which reduces carbon dioxide emissions and keeps items out of landfills.

Watch the Video8 Keys to AI Success

By incorporating innovative technologies during the return process (in-store, online, or over phone, chat, or email), retailers can make intelligent disposition choices downstream and become better corporate citizens rather than wasting time and money while destroying the environment upstream.

Utilizing innovative disposition technologies during the returns process by connecting the entire omnichannel ecosystem as far downstream as possible to an intelligent returns management platform will ensure a disposition decision that will guarantee less waste, lower emissions, and increased margins and will set a responsible corporate example for other companies to follow.

Retails and manufacturers can bring efficiencies to returns management and the world to reverse logistics while increasing their bottom line, becoming better corporate citizens, and embracing technologies that offer several benefits, ranging from improved customer service and lower operating costs to lower environmental impacts.

Source: Forbes

About the Author

Sender Shamiss is Co-Founder and CEO of goTRG (The Recon Group Inc.). During the day he tries to change the world of retail, supply chain, SaaS, AI, robotics, and automation.

Video (above): MD Logistics | 6 River Collaborative Robot Partnership

After a successful integration of collaborative robots from 6 River Systems to the MD Logistics warehouse, the MD Logistics team is already seeing increased efficiencies on the warehouse floor. As a provider of supply chain solutions, MD Logistics adopted these cobots to add another layer of quality control within their retail and consumer goods facility.

Read Our Customized Supply Chain Solutions Brochure (PDF)

Related White Papers

Download The E-Commerce, M-Commerce and Omnichannel Effect

The Ecommerce, Mcommerce, and Omnichannel Effect
In this white paper, we take a complete look at how e-commerce, m-commerce, and omnichannel commerce are impacting traditional supply chain models. Download Now!

Download Returns in the Retail Supply Chain with a Specific Focus on e-Commerce

Returns in the Retail Supply Chain with a Specific Focus on Ecommerce 
This white paper will explore the impact of e-Commerce on reverse logistics, highlighting the customer-driven process at the distribution center level. Download Now!

More MD Logistics Resources

Article Topics

6 River Systems News & Resources

Ocado Group announces agreement to acquire 6 River Systems
6 River Systems rolls out mobile fulfillment app to extend picking options outside of its AMRs
How to Manage Increasing Warehousing and Fulfillment Costs
Optimizing Your Returns Management Process
Warehouse Technology: Today and Beyond
LEGACY Supply Chain Announces Deployment of eCommerce Fulfillment Technology Solution
Warehouse Technology For Today and Beyond
More 6 River Systems

Latest in Supply Chain

Artificial Intelligence to Drive M&A Activity in Supply Chain
Cleo Announces New Supply Chain Management Tools for Integration Cloud Platform
ASCM Honors Supply Chain Management Leaders with Awards of Excellence
US Container Traffic Boosted by Back-to-School Rush
Bank of America Introduces Digital Supply Chain Finance Platform
Moody’s: Carbon Offsets Open Supply Chains Up to Financial, Reputational Risks
Shippers Focus on Yield Management as Rates Continue to Rise
More Supply Chain

6 River Systems (6RS) is a leading fulfillment solutions provider for 3PL, multi-channel commerce, retail and B2B companies worldwide. With Chuck, the most flexible and configurable collaborative robot in the industry, 6RS empowers operators to transform the entire fulfillment workflow from putaway, to picking, sorting and packing. The 6RS solution fulfills millions of units each week for companies across North America and Europe, including DHL, ACT Fulfillment, Office Depot and XPO Logistics.

View 6 River Systems company profile


Featured Downloads

Thinking Differently About Supply Chain Planning
Thinking Differently About Supply Chain Planning
Political landscapes shift overnight, global trade is constantly changing, consumers demand increasingly personalized service and smaller day-to-day challenges hit without warning. If...
Rapidly Improve the Performance of Your Warehouse Logistics
Rapidly Improve the Performance of Your Warehouse Logistics
The Rapid Performance Evaluation identifies opportunities and potential improvements in every aspect of warehouse logistics operations; performance, productivity, service, quality, and systems.

Resource Management System (RMS): How to Effectively Leverage Your Assets
Resource Management System (RMS): How to Effectively Leverage Your Assets
This guide provides an in-depth analysis of the potential of various resources available in a warehouse and how they can be utilized...
Sustainable Supply Chain Insights From PITT OHIO
Sustainable Supply Chain Insights From PITT OHIO
A whitepaper on supply chain insights gleaned at the LEED-certified gold Cleveland transportation and sustainability summit.
20 Warehouse & Distribution Center Best Practices for Your Supply Chain
20 Warehouse & Distribution Center Best Practices for Your Supply Chain
In this guide, we picked the brains of our supply chain engineers to find ways to improve warehouse and distribution center efficiency...