More Shippers Address Financial and Carbon Costs of Post-Holiday Returns

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While families across the globe may be done grieving the late arrival of that coveted holiday gift, the same labor shortages and omicron disruptions, including inflation, may impact the next iteration of holiday shopping: returns.

According to commercial real estate firm CBRE's latest report, approximately 30% of online sales will be returned, as opposed to the 10% return rate of brick-and-mortar sales. While it might be a simple and free process for the consumer, it's not so much for the retailers, which rarely have the data and visibility to measure the extent of that cost. 

Factoring in labor, transportation, warehousing and the removal of personal data, the average return costs two-thirds of the original price. Aside from cost, the logistics of returns aren't environmentally sound, as they aren't shipped in full truckloads but rather one at a time. Because it costs more money than it's worth to return the item to its vendor for reuse, returns often end up in landfills ⁠— an unsightly destination for many carbon-conscious consumers. 

To address the cost and inefficiencies, many shippers are integrating flexible returns management systems (RMS) to automate and digitize the entire returns process on a single platform. 

One such company is Finland-based Amer Sports ⁠— parent company of  athletic brands like Salomon, Atomic and Suunto ⁠— which generates 2.5 billion euros in revenue and manages 40 warehouses. With its recent transition from B2B to B2C, the company is managing a major influx of returns, often coming in improperly packed and wrinkled.

"We're talking about hours just to process the return and enable the crediting to the consumer," said Kai Bahmann, vice president of warehousing.

In order to speed up the workflow of manual returns and improve the consumer experience, Amer Sports integrated the ReverseLogix RMS, and after only two or three days of onboarding, employees felt comfortable using the platform. 

"When we started with ReverseLogix we had no transparency in the process at all," said Bahmann. "Now with the provided reports with reason coding, including how often returns are happening and how many products are in bad shape, we are gaining control of the process and can make adjustments for the brands regarding what needs to be improved to reduce returns in general."

With ReverseLogix, warehouse managers are able to keep track of each processor's daily totals, as well as view arrival queues, which helps managers efficiently delegate projects. By using a tracking number, workers are able to effectively manage the inbound process and access all associated accounts. 

"It definitely doubles the amount of returns that we are able to do," said Hayden Rice, returns specialist. "You get notes from the customers to understand why you're getting the return in the first place and what to look out for. It shows photos so you know you have the right product without having to look through numbers." 

Customers can easily sign into the platform to get their return labels, which has undoubtedly reduced customer service call volumes. Return lead Tyler Hill said he is able to train staff without a lot of explanation, which allows productivity to sustain itself through the integration process. When the Amer Sports team has an issue or question, the ReverseLogix team responds quickly, with an innovative problem-solving approach. 

"ReverseLogix was the partner who shared their best practice with us so that we could define our best-fitting process," said Bahmann.

Image provided by FreightWaves

This post contains sponsored advertising content. This content is for informational purposes only and not intended to be investing advice.