The BBC recently reported that in a survey conducted by the UK’s Savvy Marketing agency, 66% of those surveyed sent back a women’s apparel item purchased online within the last 6 months. The Financial Times recently cited other statistics indicating that while 25% of women’s apparel purchases were destined to be returned, that number paled in comparison to the return rate in Germany, where a whopping 70% of items ordered online were returned.
These returns are driving down already thin margins for retailers worldwide, especially those in the UK and Europe. Yet, in multiple surveys, shoppers indicated that a generous return policy is a key factor when deciding whether to purchase an item online. How can retailers control cost of their online returns to protect their margins, yet still attract online shoppers who demand robust return service options?
The first strategy to control the cost of returns is to keep the cost of reverse logistics on those returns to a minimum. Many online retailers try to make it easier to facilitate returns by working with a single carrier for all returns. This works out great for the carrier, but could be costly to your business if you’re unable to take advantage of cost efficiencies that might be offered by other carriers.
With a solution like PRECISION Multi Carrier and Enterprise Shipping Software , you can compare costs across carriers to get the lowest price on every return. With a single source of reliable data about return shipping costs and performance, you have the tools you need to negotiate rates with every carrier and reduce costs even further.
We make the process of tracking return shipments across multiple carriers easier as well, with uniform, centralized tracking information and reports that can be made available to store staff, customers and managers. It’s simple to track the status of each return on every carrier as it moves between DCs, stores and customers.
According to the 2016 “UPS Pulse of the Retail Shopper” survey, 60% of consumers actually prefer to return their items to a store rather than online. In-store returns present a huge opportunity: According to the survey, 70% of those shoppers who returned online purchases to a store bought other items while processing those returns.
Ship to Store is another great way to reduce cost of returns, since it provides consumers with an opportunity to determine if they will keep an item before taking it home, as well as to make additional purchases. The UPS report indicates that 50% of online shoppers have shipped to store for pickup; while there, 43% of them purchased additional items.
Turning your retail storefronts into a fulfillment and returns center for online consumers allows you to drive margins by reducing those expensive last mile shipping costs and delivering more consumers to your stores, many of them ready to buy. But, to efficiently manage in-store returns and fulfillment, you need multi-carrier and enterprise shipping software that can be rolled out quickly and easily in all your retail stores.
Precision offers an easy-to-use interface that makes it fast and easy to ship to stores, to the consumer’s doorstep or back to a distribution center. It allows you to set up pick up / drop off (PUDO) service at your retail locations, and determine service points for each order and return. It also streamlines the process of managing multiple carrier accounts across all your retail storefronts.
A multi carrier and enterprise shipping software solution is a must for retailers that want to drive down the cost of shipping and increase the margin on their online sales.
But there’s a hitch: Some parcel shipping solutions—whether cloud or on-premise—are priced based on seats as well as the volume of shipping you use. That means that if you ship a million packages, then you have to pay for the cost of shipping on those items, plus the license fee, plus any service fee charged per return by your multi carrier and enterprise shipping software provider. This gets expensive when you’re processing a large number of returns, and can also make those costs unpredictable, leaving you vulnerable to big cost increases when return volumes are highest, such as after the holidays.
Precision offers a cloud-based software application that can be rolled out quickly to retail storefronts and online fulfillment centers. It’s easy to use, which means you can have the system up and running within days. And we do it all for a predictable flat rate, which means no surprises if your shipping volumes are higher than expected.