Posts Tagged ‘returns management program’

 

Returns Management in Your Supply Chain

 

Every supplier, either wholesale or retail, has to deal with returns and defective products at some time or another. It’s all a part of doing business, but usually results in a financial loss, and a quandary as to how to dispose of the returns. If a company were to institute a returns management program for dealing with returns, there is a possibility to recoup some of the financial loss.

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Returns Management and Your Bottom Line

Consider the impact returns have on your customers. First, they have to spend their time and energy to bring the product back to the store. Then, if the item is not in stock or has to be ordered, they will have to come back again or wait for the item to be shipped. All this is aggravating to the consumer and could cause the loss of one or more customers, if the return is not handled properly. In today’s social networking world, one unhappy customer could have could have a major effect on new sales revenue!

Returns Management

Other costs of returns include:

  • Costs to process returns
  • Cost of replacement or refund to consumer
  • Transportation costs to bring in replacement items
  • Warehouse space and stocking costs
  • Labor costs for sorting, triaging and determining warranty status
  • Costs incurred to return to the manufacturer or distribution center

These negative impacts to both customers and company bottom lines can be avoided and actually turned into profits with the right returns management strategy.

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