An introduction to Returns Management
Three global trends, direct-to-customer commerce, the experience & share economy, and the circular economy all result in product returns. Companies that sell products need to be prepared for product returns.
Customer have multiple reasons to return while using a product. When returning a product customers ask for service. Therefor the service journey is part of the overall customer journey. The service journey offers undiscovered opportunities for service interaction with the customer.
Returns can be a burden but are an opportunity if managed well. The Reverse Supply Chain delivers value in 5 different areas.
The returns process starts and ends with communication between you and your customer. Communication about what is being returned and why and communication about the service that is offered. Communication turns an unhappy customer into a happy customer.
The returns process is continued with a planned execution. Execution of transportation, receiving and disposition of the returned product. Execution brings the value of returned products to life in a new value chain.
A unified returns process delivers unified data that can be turned into valuable insights for your business. Insights about your customer, about the product and about the returns process itself. Insights that can be used to prevent future unwanted or promote future wanted returns.
Companies need return-cycles in their supply chain to support product returns in different phases while the customer is using the product. Typically, a company deals with 3 main return-cycles that can be visualized in following supply chain diagram.
Excess inventory, point-of-sale returns,
Defects, maintenance and recalls. Offer a fast and reliable returns process that gives confidence to your customer. Deliver a reliable after-sales service that safeguards availability and
Trade-in, take-back, and buy-back. Enable your customer to return obsolete products into a sustainable asset recovery process. Unlock Re-Commerce and Circular Economy opportunities.
Return-to-Settlement is a new business process that exists of a customer part that is typically service focussed (Returns Authorization and Returns Settlement) and an operational part that is typically cost and product focussed (Reverse Logistics and Returns Processing).
Customers submit a request to receive authorization for a product return (Return Material Authorization).
Products are returned from the customer to the location where returns processing takes place.
Product returns are received, inspected and dispositioned through various actions like restock, repair or recycling.
Finally, the product return is settled with the customer through various actions like a refund, exchange or reward.
The Return-to-Settlement process comprises of 4 processes that manage product returns from customers. Returns Disposition brings products to life in a new value chain.