Thinking Holiday Peak Season? Don’t Forget Reverse Logistics

Holiday peak season doesn’t come to an end when the presents are unwrapped. For retailers, January and February mean holiday hangover. With a rise in orders comes a rise in returns – so much so that UPS has launched a “National Returns Day” in early January. On Jan. 3 2018, the carrier delivered 1.4 million returns, an 8% uptick from the prior year.

If you’re looking to revamp your warehouse processes to drive faster fulfillment, don’t forget that an efficient returns process is just as important in driving a better customer experience. Let’s take a look at how you can master reverse logistics and make the process count toward your bottom line this peak season and beyond.

Work from the Ground Up

Speed, efficiency and organization are key factors in deploying successful and profitable returns processes. But your warehouse team shouldn’t shoulder the responsibility alone.

Reverse logistics is a strategic process that should be evaluated and deployed across functions, from sales and finance to customer service and operations. Through collaboration among these various groups you can determine which returns model is right for your business.

If you choose to manage returns in house, work with your operations team to streamline processes and optimize layout. Achieving efficiency requires a better understanding of your pain points, and performing a productivity analysis can help you make the most of your resources. Start by examining your returns process for one week. Evaluate every step from unloading to restocking and determine how long it takes your team to sort goods, determine resale value and move the item to its final destination. This data can serve as a foundation when you set goals for improvement (i.e. sort goods 10% faster).

If you’ve completed a productivity analysis but would like to dig deeper into your data, a warehouse management system (WMS) can help you understand where and how to organize your warehouse layout to ensure optimized processes, including reverse logistics. By providing insight into what was returned, why it was returned and whether it can be resold, the WMS enables a more streamlined returns process while helping you evaluate your best options for returned inventory.

Develop Clear Policies

To enhance returns performance, you’ll need to implement a realistic set of warehouse procedures to ensure your team can manage return volume without getting overwhelmed.

Start by speaking with your fulfillment center’s frontline employees. They see the returned inventory, identify fraudulent returns and missing product components and make judgment calls regarding resell value. Tap their experience to develop a logical returns strategy. By implementing a clear flow for returned goods you can help your operations team avoid inaccuracy, inefficiency and ultimately lost profits because of unclear procedures.

Once you’ve determined your optimal reverse logistics strategy, a WMS will help you maintain new process rules. You’ll ease the burden on your returns team and simplify product storage procedures.

Think back to National Returns Day and the planning involved on UPS’ end. For the logistics giant, those deliveries are only possible with a clear set of rules and advanced warehouse technology to guide returns. You need logical, streamlined processes to keep up with demand and effectively recover the cost of returned products.

Measure to Improve

While you may not be able to master reverse logistics overnight you can adopt a more strategic approach to technology for measuring current processes and identifying areas to improve. Each phase of the returns process must be analyzed and enhanced to drive optimal efficiency.

By evaluating current state, collaborating across the fulfillment center to develop a better strategy, optimizing operations and implementing effective policies, your team can perform at the highest levels of productivity and optimization. You’ll decrease profit loss from returns and increase customer satisfaction.

With the proper strategy, analysis and technology, reverse logistics can be a unique opportunity to improve your operations and customer relationships.

Don White is Vice President of Enterprise Solutions at Snapfulfil

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