Av Trimble smartdelivery | Article | January 31, 2019

What Does Reverse Logistics Policy Mean to the Consumers?

One Size Does Not Fit All

According to a study conducted by Newgistics, most retailers spend 15% of their expenditure on returns alone. So, why are these retailers willing to pay such a price? Well, most e-commerce platforms offer free and convenient returns in today’s world. And it’s this ease of shopping and customer experience that’s creating more return customers for such businesses. Ask long-term customers why they stick to certain brands. You’ll definitely hear at least one story about an effortless return.

What exactly is reverse logistics?

By definition, reverse logistics refers to the returns process where items are moved from their usual final destination for recapturing of value or disposal. Reverse logistics can be applied to damaged goods, seasonal inventory, recalls, restocking, hazardous material and recycling. In a casual context, reverse logistics refers to the process through which items are reclaimed by a company. Essentially, reverse logistics is the returns process and policy adopted by a retail brand.

How does a reverse logistics policy affect a brand’s consumers?

As consumers become more empowered and sophisticated, the need for advanced return systems increases. Companies such as Hewlett Packard have adopted recycling to reduce waste production while lowering operations costs and earning favour with consumers. Reverse logistics can also refer to simple returns that affect a consumer’s relationship with a brand.

How you manage returns affects how your customers see you as a potential long-term go-to for certain products. Why is Amazon so popular among people all over the world? There’s no dispute about the brand’s enormous image. But if you ask loyal Amazon customers why they keep purchasing from the brand, they’ll definitely talk about the shopping experience. A massive part of the shopping experience is the return experience.

How effortless is it for your consumers to return items? The answer to this question will help analyse your success in the retail industry. Want more return customers and brand loyalty? Work on optimising your reverse logistics or return policy.

How brands are using the reverse logistics policy to woo consumers

Curious about how your return service affects business? Analyse top retailers like Amazon or Zappos. Notice that they have made returns effortless using return labels and an efficient mobile logistics solution. Consumers simply need to attach these labels to packages and send them back via well-organised pickup and delivery services. The returns process barely requires any input from the consumer. Sometimes, these returns result in absolutely no extra charge to the consumer.

Implementing this for your brand is challenging, but possible. By smart delivery management and routing optimisation, you can make returns cost effective for your company. This, in turn, will enable you to make returns easier for your consumers.

Logistics companies such as UPS are also performing well in their return logistics. UPS make it easy for small businesses to receive returns from their customers, therefore being able to compete with bigger players. UPS helps these small businesses print return labels, schedule pickups, and track returns. UPS is effectively building lasting relationships with their customers (small businesses) in the process.

What’s the key goal of optimising your returns? Is it to cut costs? Well, that’s only a small part of the major goal. Ultimately, you want to use effortless returns to build a loyal customer base of returning customers. MIT Sloan Review states that you can increase overall profits even when the economy is on a low by managing customer returns well.

In today’s world, it’s impossible to do away with returns. Since you have to deal with returns, it makes sense to focus on lowering their costs. Interestingly, the smartest way to lower returns costs is by focusing on customer satisfaction. Most elegant and cost-effective returns systems place the customer at the centre of the process. Consider any e-commerce giant or multi-national company as an example. You’ll notice that they have a great returns system that places special emphasis on customer experience and satisfaction.