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How to optimize the reverse logistics process and manage your e-commerce returns

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How to optimize the reverse logistics process and manage your e-commerce returns

The management of returns in e-commerce has become one of the main challenges faced by the logistics managers of various online stores and logistics operators due to the volume and frequency of these returns.

E-commerce stores have been relaxing their return policies, as this has proven to be an effective strategy to remove online shopping barriers and increase sales. This has long been an unwritten rule in the industry.

However, reverse logistics consumes resources and complicates processes throughout the supply chain. So how do you successfully handle returns management in e-commerce?

1. Integrate the returns of your e-commerce business into the core operations of the supply chain.

In today’s e-commerce logistics, merchandise returns have not only become standardized, but they have also become part of the day-to-day management of any warehouse. Therefore, e-commerce returns must play their proper role in the supply chain.

This is why coordination between the different links in the supply chain is essential, leading to the complete integration of the software that operates at each stage.

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In this sense, the information must be shared and managed by all parties involved, typically the WMS from the storage facility, the TMS (Transportation Management System) from the transportation fleet, and the ERP (Enterprise Resource Planning) that holds the common database for all of them.

This ensures greater control and planning of the flow of goods. In fact, order traceability is not only important for communication with the lead, but it is also essential for the warehouse to know when it will receive returned orders and to organize transport operations.

2. Evaluate the causes of returns to reduce their frequency and impact.

After receiving the product, it is necessary to verify what caused the return of it. In this way, the causes of the return will be specified:

Suggest improvements to reduce the cost of returns: Once you understand why, you can also take measures to prevent them from happening, such as systematically checking shipping addresses and even canceling orders within a certain period to compensate for impulse purchases that end in returns.

Establish a plan of action: for example, if a lead returns a product but also requests an exchange, the same itinerary can be used to deliver the new order and pick up the package to be returned.

Remember that returns management in e-commerce is part of the customer’s shopping experience, so it is important to anticipate and propose strategies to build a relationship of trust with the customer.

Therefore, ensuring a wide variety of collection points (omnichannel logistics is becoming increasingly important in this regard) or providing the customer with ready-to-return packaging are measures that reinforce returns management in e-commerce.

3. Adapt your warehouse to handle e-commerce return

For example, to prevent your warehouse from turning into a horror movie after Black Friday, it is advisable to prepare your facilities to handle the continuous high volume of returned products. The first step is to set up specific regions for quality control of returns.

In all other aspects, a Warehouse Management System (WMS) plays a key role as it enables:

  • Establish clear procedures to enforce quality control, limiting improvisations, as many as possible, that can lead to failures in the chain. Therefore, the product reception process must take into account the role of e-commerce returns. In this regard, Copernico WMS facilitates the reception of a product and the grouping of orders, thus streamlining the entire operation.
  • Re-tag items for later storage and manage the new locations assigned to those products.
  • Update information in the inventory database to better control stock on hand.

The success of your e-commerce returns management relies on process integration and effective communication between all participants in the supply chain.

Warehouse management systems such as VGS’s Copernico WMS are designed to optimize this and other tasks. If you want to know how it contributes to warehouse returns management, contact us, and we will show you a customized demo.

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