Reverse logistics is a major supply chain issue for retail and e-commerce players in France. Like delivery, management of returned products is now a key element of customer satisfaction.
It generates ever-increasing costs and processing times in warehouses, with an impact on the efficiency of an enterprise’s logistics planning, margins and cash flow.
Today, the challenge is to optimize costs while speeding up the logistics of consumer returns to allow products to be put back on sale, returned to the supplier, or recycled faster than ever before.
Return managements and reverse logistics: their importance for customer satisfaction and supply chain efficiency cannot be underestimated!
Returns management is a legal requirement in France.
For consumers, the ability to return a product is one of the top 3 criteria that decide the sale of a product, after price and delivery.
In addition to its effects on the transformation rate and the constraints it imposes on sales, returns management is a key element in customer loyalty and satisfaction, and even a competitive advantage.
Which means we have to rationalize our processes and, more importantly still, our costs.
One figure speaks for itself: the logistical cost of managing a return is now on average 10 euros per product, and that’s without transport!
According to FEVAD figures for the French market:
24% of goods sold via e-commerce are returned, against an average of 10% in other sectors. And 70% of product returns are based on subjective criteria (colour, material etc.).
Return rates are as high as 40% in countries like Germany, where consumers pay for their products not at the time of ordering, but at the time they return to the warehouse.
Reverse logistics: above all, a legal obligation
In France, under the HAMON law, consumers have 14 days to change their mind and return their orders. Merchants are obliged to reimburse consumers within this time limit.
Conversion of returns and faster re-sale are the most effective ways of minimizing the financial impact of product returns.
Reverse logistics: your key to higher sales and customer satisfaction
76% of online shoppers check the return conditions before confirming an order.
If the terms do not suit them, 51% then cancel the purchase process.
Returns policy is now a key aspect of the sales and customer experience.
An attractive and fully transparent returns management policy contributes to not only to customer satisfaction, but also to customer loyalty.
Costs cannot be overlooked
Returns management is a costly and inherently random process which can impose considerable strain on your supply chain.
Receiving returned products, checking them, and storing them pending their return to sale requires a succession of handling stages and requires operators to travel long distances.
Logistics professionals have the task of making returns processing more reliable, and making sure items are correctly returned to stock.
Put briefly, reverse logistics has a dual mission: to reduce storage and the associated costs, and to quickly give a “second life” to products. Levers for optimizing reverse logistics:
- upstream organization of reverse logistics
- return labels
- streamlined processing of return flows in the warehouse.
Faced with the need to accelerate processing times without loss of quality, returns management increasingly sees automation, and more particularly goods to man robotics, as the best alternative for reducing product handling and operator movements, and increasing the reliability of operations.
Goods to man robotics at the service of agile, cost-effective reverse logistics!
Robots are the perfect solution for faster, more agile reverse logistics. They play a major role in moving goods around, Bringing shelf units directly to the operators.
The automation of physical flows of goods also saves considerable time in the logistics of returns, sorting, and resale.
We already have next-day deliveries. With the help of automation and robotics, we can also aim for next-day returns management, or even same-day!
Automated sorting and storage of returns
With goods to man solutions like the one offered by SCALLOG, returned products (individual items or boxes) are placed in an empty slot in the storage racks.
The operator first scans the product or box before placing it on the rack. Then she scans the location code so the product is automatically indexed and listed under this location in the WMS.
This method frees the operator from the need to make awkward movements and walk long distances, and gives her more control over order picking and storage tasks.
Automation for more reliable reverse logistics processes
A robotics solution offers immediate gains for track and trace, fluidity and productivity. All product returns are tracked and indexed, eliminating inventory loss and error.
Add to that an unparalleled productivity gain in returns management - an 8-fold increase in processing and return to stock rates compared to manual operations!
In other words, with a robotics solution it takes one hour to put a product back on sale, instead of eight hours as before.
Automation of quality control
At present, 99.9% of quality control is performed by operators during picking. But this process can be automated too.
In the future, returns management and retail picking stations will be equipped with time-saving cameras that detect stains, wear, improper folding etc. to save even more time and improve stock management.
Returns management is a real financial and commercial challenge for retailers and e-commerce players, and every day - every hour, every instant - counts when it comes to cutting costs and securing customer loyalty!
Now more than ever, automation is proving its efficiency in logistics, supply chain management and warehousing.
With the prohibition on the destruction of unsold goods to limit waste, automation leads the way in returns management that’s agile, responsible, a driver of further growth !
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