According to Deloitte’s annual holiday forecast, this year will see a 7-9% increase in holiday retail sales. To top it off, e-commerce sales are set to grow by 11-15% compared to 2020.1 And tagging along with this increase in holiday retail sales comes an increase in returns, especially in the e-commerce sphere.
To keep up with the busy holiday season and the even busier post-holiday returns season, we have developed a comprehensive checklist for you. With this checklist, you will be able to stay on top of your returns management process!
1. Perform a Returns Management Audit
Unless you are aware of your current state, you cannot reach your desired state. Hence, before you prepare yourself for the peak returns season, you should perform a post-holiday returns management audit.
Go over the data from the post-holiday returns of the previous years, review the processes you employed, and check the current returns handling capacity of your infrastructure. Go through your return policies with a fine-tooth comb and also analyze the previous feedback and complaints from customers, as well as inputs from employees.
Performing an audit allows you to identify not only the gaps in your current processes but also opportunities to enhance the customer experience as well as reduce return rates in the future.
Pro Tip: Trace your customer returns journey to identify gaps in the current returns process. Or maybe place an order and return it yourself to see if the experience was customer friendly!
2. Set Clear Goal & Objectives
To successfully handle the post-holiday returns rush, you need to begin your returns management process with a clear goal.
Customer experience is at the heart of any business, thus offering a seamless customer returns experience should be your top priority. Your entire plan should revolve around this goal. But to achieve this goal, you need to break it down into clear objectives.
Objectives may include reducing processing time for returns, mitigating customer confusion points, developing real-time visibility of inventory, automating repetitive processes, improving bottom line and even reducing overall return rates.
Pro Tip: When you go above and beyond to provide exceptional customer service, you drive brand loyalty and repurchases
3. Clearly Define Returns Policies
Clear communication is key for a smooth returns process.
Now here, there are two considerations: first, you need to ensure that every member of the staff is well-versed with the returns process. The teams accountable for managing the returns process should be informed in detail about all the steps in the process to handle the peak season returns rush. Keep them up-to-date with the latest info on the returns process to avoid any kind of delays or misunderstandings.
Secondly, your returns policy should be communicated clearly and thoroughly to your consumers. Address questions such as – What products are eligible for returns? What condition does the product need to be in to be eligible for returns? How soon does the return have to be initiated? What are the steps of the returns process? Where/how can they return the products?
And yes, don’t forget to keep your customers informed about the status of the returned product throughout the returns management process!
Pro Tip: Consider tweaking your current returns policy to match the consumer needs of the peak returns season. For example, if your business normally offers a 30-day return period, consider implementing a 45-day return period just for the holidays.
4. Consider Additional Inventory Space for Peak Season Returns
There are high chances that your peak season return products will come back in different conditions, different times, etc. Products bought online might be returned in-store or vice versa. Similarly, products purchased at one store location might be returned at another. In such cases, you will have to account for additional space to receive, process, and store your post-holiday returns at any available returns location. Moreover, providing alternatives to returning a product will help dealing with the labor shortage if you find yourself short staffed.
While preparing for post-holiday returns, account for factors such as inbound holding capacity, inventory processing equipment, processing space and even outbound storage capacity.
Pro Tip: Businesses that deal with high returns could rent storage trailers or lease additional space to effectively manage space for seasonal fluctuations.
5. Optimize Inventory Control
Inventory handling is one of the most complicated issues of peak season returns management. And no, we are not just talking about the physical inventory, but also the electronic inventory.
Returns should be recorded and processed by your inventory control system as soon as they are received. The longer they are left unrecorded, the more wastage of resources you will experience. Tools such as portable barcode scanners are highly valuable to combat this problem and offer real-time visibility of your returned inventory.
While you are processing returns, also determine whether they are fit for resale, resale with refurbishment or liquidation. If product sold online is returned in-store, resell it in-store if possible.
6. Efficient Resource Management
The U.S. Department of Labor highlighted the labor shortage crisis which will direly impact the retail industry when it pointed out that there are 965,000 open jobs in retail.2 And with the holiday season set to begin, this problem is worsening.3
What does this mean for your business?
To manage the peak season returns influx, you should efficiently manage your staff first. To understand where you currently stand with your staffing for the holiday season, consider your answers to the following questions:
- During returns peak season, do you usually have too many or too few workers on board?
- Is finding a qualified workforce difficult for your business during the peak season?
- Are you expecting an increase in demand which might call for additional workforce?
- Is there any service area of your returns management process which has been riddled with complaints (especially by the customers)?
- Is your staff adequately trained to meet the returns needs of the season?
- Do you have adequate resources to train additional staff recruited for peak season returns management?
- Does your staff understand the returns management process, system and policies of your business thoroughly?
- Are you able to re-allocate resources from other tasks to temporarily assist with returns?
7. Offer Enhanced Capabilities
The more you make the customer returns experience seamless and convenient, the more customer satisfaction and retention you will gain.
To improve your peak season returns experience, offer enhanced capabilities to your consumer. Reverse logistics solutions such as scheduled pick-ups from the consumers’ home (even for in-store purchases) and curbside drop-offs are great ways to improve your customers’ experience and to avoid high in-store traffic for the sole purpose of returns.
Today, consumers are using multiple channels before they purchase a product. For example, they might check a product online and then visit the store to try it before buying. The shopping process has become extremely convenient with a multi-channel strategy, thus facilitating the increase in customer satisfaction opportunities.
Similarly, offering customers the flexibility to return items at their convenience will improve customer satisfaction too. Enable customers to return the product they bought online in offline stores or vice versa. According to a report by Uberall, a software solutions company, 66% of U.S. shoppers said they’re more likely to purchase an item online when it can be returned a local store. Moreover, such strategies will differentiate you from your competitors.
8. Look Into Your Operations Capabilities
High peak season returns demand an efficient logistics team.
If you are handling all your returns management in-house, ensure your fulfillment center has the resources and ability to manage the high influx of holiday returns. A broken logistics chain would not only cause you money but also repeat business. If you anticipate that the peak season returns calls for additional reinforcements, consider outsourcing your reverse logistics.
9. Post-Peak Returns Follow Up
If you have managed to check off all the above-mentioned items from your peak season returns checklist, congratulations! You are now ready to handle the pressure that comes with the busy post-holiday returns period.
However, the process doesn’t stop here. Double down on your holiday returns reports to determine areas for improvement and any gaps in management. This is an appropriate moment to ask yourself questions such as:
- Were predictions for post-holiday returns accurate?
- Were we able to achieve our goals and objectives for the peak season?
- Did we successfully maintain internal lines of communication with our returns staff?
- Did we manage to explain our returns policies to our consumers without any confusion?
- Were we able to efficiently utilize the space we had? Was there a need for additional inventory space?
- Were we able to extract the maximum profitability from our returned inventory?
- Did we have enough human resources to deal with the peak season returns period?
- Was the staff trained adequately?
- Were there any additional services we could offer to enhance our customers’ experience?
- Was our logistics process efficient enough to handle the holiday returns rush? Should we consider solutions from reverse logistics providers?
The answers to these questions are your key takeaways for next year’s holiday returns. Prepare in advance for the peak season returns rush to optimize your operations and get the most out of your returns.
Download The Ultimate Peak Season Returns Management Checklist now to prepare for the post-holiday returns rush in a streamlined manner.