Plan Now to Manage Holiday Returns
November 2004 By Debra Ellis, president, Wilson& Ellis Consulting
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Catalogers often try to reduce associated returns costs with policy initiatives. Since returns are seen as a bottom-line deficit, countless hours are spent defining a policy to minimize returns. Here are four tips for better managing returns:ï3/4ï3/4 ï3/4ï3/4
1. Divide the responsibility for returns between appropriate departments. If returns are due to product quality, your merchandising team must be involved in the solution. If they’re due to presentation issues, the creative team must participate. Slow deliveries? Get your fulfillment and inventory teams involved. Tip: Create a returns team with members from each department to focus on return reduction and management. Fiscal responsibility also should be shared.
2. Always pay for return shipments when your company is in error. It simply improves customer relations.
3. Know your cost of processing returns. Use this information to make choices about how to handle customer satisfaction issues. If the cost of processing a return is $7, you don’t want to require a customer to return a $4 item that was shipped incorrectly. Simply let the customer keep the item and ship the correct product immediately.
4. When calculating the costs associated with returns, don’t forget lost sales due to a strict returns policy. Prospects are hesitant to try a new company. A returns policy that requires return authorizations, restocking fees and other road blocks will significantly increase that hesitation. If you’re unsure of the effect, use an A/B split test to see the results.
You can reach Debra Ellis at (828) 626-3756, or e-mail: dellis@wilsonellisconsulting.com
1. Divide the responsibility for returns between appropriate departments. If returns are due to product quality, your merchandising team must be involved in the solution. If they’re due to presentation issues, the creative team must participate. Slow deliveries? Get your fulfillment and inventory teams involved. Tip: Create a returns team with members from each department to focus on return reduction and management. Fiscal responsibility also should be shared.
2. Always pay for return shipments when your company is in error. It simply improves customer relations.
3. Know your cost of processing returns. Use this information to make choices about how to handle customer satisfaction issues. If the cost of processing a return is $7, you don’t want to require a customer to return a $4 item that was shipped incorrectly. Simply let the customer keep the item and ship the correct product immediately.
4. When calculating the costs associated with returns, don’t forget lost sales due to a strict returns policy. Prospects are hesitant to try a new company. A returns policy that requires return authorizations, restocking fees and other road blocks will significantly increase that hesitation. If you’re unsure of the effect, use an A/B split test to see the results.
You can reach Debra Ellis at (828) 626-3756, or e-mail: dellis@wilsonellisconsulting.com
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