In an increasingly omnichannel world, returns are only getting more complicated and, if managed incorrectly, more expensive. Some estimates put the total cost of returns for the industry at a staggering $642.6 billion—or the equivalent of 11.7% of revenue.
To make matters worse, many retailers have only themselves to blame for high return rates. A recent Voxware survey found that 54% of customers had returned an item because the retailer had shipped the wrong size or color. For this reason, it’s critical that fulfillment centers implement systems like voice-directed picking to overcome accuracy and efficiency challenges. Voxware customers regularly see accuracy improve to 99.9% and efficiency improvements of up to 35%, which leads to more correct deliveries and fewer returns.
Additionally, the returns process can have a strong impact on sales before they’re even made. Since customers can’t try on items before purchasing them, it’s important to offer a flexible return policy—with the supply chain systems to support it—so that sales aren’t driven away. Here are a few tips for ensuring that returns don’t turn away sales.
Offer returns both in-store and online. From a consumer’s perspective, there are no sales channels—there is only your brand. By making it easy for shoppers to return items they’ve purchased online in stores, not only does it offer the customer choice and convenience but it also drives additional foot traffic into stores.
Don’t charge a restocking fee. While it may be tempting to pass the cost of processing returns on to customers, restocking fees can actually turn away sales. A Multichannel Merchant Report found that 82% of customers were likely to purchase items without a restocking fee but that figure fell to 33% when a restocking fee was present.
Implement systems to make returns processing fast. When returns don’t make it back into bins in time, customers looking to purchase items risk missing out on out-of-stock items that are waiting around to be restocked. By implementing voice in the fulfillment center, companies can make sure that out-of-stock items make it back on the shelf in time to ship to a new customer.
As ecommerce and mobile commerce continue to take an ever-bigger chunk out of total retail sales, it’s critical that companies understand the far-reaching impact of returns on the industry—and how to manage them. Fulfillment centers that have deployed top systems like voice will be far better positioned to succeed in an omnichannel world.