With sales on, returns rates are increasing. To preserve their profits, online retailers must urgently re-examine old manual order preparation processes and automate them as much as possible. Instead of having to throw away a returned item, they will be able to resell it in-store or online at full price. In an era where profit margins are under pressure and consumers are used to trying on their purchases at home and then returning them, smooth and efficient reverse logistics is essential.
With the sales just starting, retailers are on deck to deal with the seasonal spike in online orders. In the process, they must process a flood of clothing returns and put items back on sale as quickly as possible: 45% of French consumers return their purchases made online according to a survey conducted in June 20231. According to Scalapay, clothing is the top purchase for French consumers (42.9%). 2. Often too small, too big or not to the consumer’s taste when delivered, this type of product is also the most returned (21%).3. But these are not the only products concerned and faced with the influx of returns, retailers must absolutely integrate returns into their logistics strategy.
Think about the returns policy from the moment of sale
Retailers want to reduce the number of returns as much as possible. Zalando already offers body scanning in other countries to reduce the number of returns of unsuitable clothing. H&M announced the end of free returns at the end of 2023, something many small online stores have been doing for some time because they have no other choice. The strategy has apparently paid off. After Dutch company Wehkamp introduced a return fee last year, it saw up to 5,000 fewer returns per day. For retailers, the question of returns logistics can be confusing. Consumers like to try on clothes at home and order more if they know there are no return fees. Therefore, many companies are looking for a quick way to process millions of returns and put items back in stock both online and in stores to avoid losses. This is only possible if they have an organized logistics system behind the huge inventories of online stores. After all, increasing consumer fees for returns is one thing. Better streamlining the returns process as a business is another. With the number of returns increasing, retailers need to process returned items promptly and return them to their saleable inventory. This is especially important in the fashion industry because seasons are so short. Clothes go out of style faster than any other type of product, and previous collections, often only a few weeks old, are quickly discounted, losing margin and revenue. That’s why so many omnichannel brands offer free in-store returns for online purchases. This tempts customers to browse products online and in-store and potentially purchase more, while store staff can quickly put clothes back on the shelves as soon as they return from a fitting.
The importance of reverse logistics
Online retailers must therefore ensure that their ordering processes are as smooth as possible in order to improve their profitability. It’s critical to give reverse logistics as much importance as other processes. Many retail warehouses still manually pick e-commerce orders, which requires three to five times more labor than high-performance automated robotic systems. Productivity is even lower when returned items are stored in a non-automated warehouse and then repacked. Warehouse robots or order picking robots can speed up the process by immediately scanning returned items into a bin with other items. This eliminates the need to run from one corner of the warehouse to the other to find each item and place them in a separate returns area, which shortens lead times and requires less manpower. When a new order arrives, the returned item is always the first to be presented to the order preparation station.
(1) Statista survey “Return of online purchases in selected countries 2023” from June 2023
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(2) Scalapay Study – Shopping Trends in 2024
(3) Statista survey “Most returned online purchases by category in France 2024″ conducted between June 2022 and June 2023
Source: www.ecommercemag.fr
