How to Develop a Reverse Logistics Strategy
These service providers and others offer value-added plans for returns processing, and they provide technology that allows you to generate postage-paid labels to facilitate easier customer returns. (Typically the postage-paid label is deducted from the customer’s refund.) The labels also enable visibility into the goods being returned to you in advance of the shipment, thus enabling you to achieve better distribution resource planning.
Customers can complete the enclosed returns form, package it with the merchandise being re-turned, and then drop the entire package off at a designated pick-up location such as the U.S. Postal Service (USPS), FedEx or UPS. Such third-party services transmit updates to the customer file of the multichannel company in advance of the returned product being received.
These types of return labels store all the appropriate information concerning the order and customer information. Once you get the returned item back, the merchandise is processed. Depending on your business rules and logic, the item can be given a disposition such as return to vendor, salable, destroy, etc. From there, the items can be sorted based on the disposition.
Many vendors offer some limited re-work and sorting down to the item level, and then aggregate it to save on freight costs back to you. This also allows you to get and process the goods much easier when the shipments arrive at your DC.
Depending on the disposition, the merchandise can be re-routed, based on your stated business logic. For example, goods can be transferred to a liquidation or clearance center, disposed of due to damage or returned to your vendor.
Typically, third-party companies handle either all or part of the returns process, based on how much control you want to hand over. The visibility of returns these companies offer also allows you to get the return information much quicker, and it allows you to process the refund, replacement or exchange much faster. Following are some of the reverse logistics services currently available: