DC Velocity - November 2017

Today’s consumers love the convenience of online shopping, but it often takes them a few attempts to find the perfect fit. Retailers have a solution for that. To ensure a “frictionless” online shopping experience, they promise hassle-free returns. Shoes too small? Return them. Pants too long? Return them. Sweater too tight?

Return it.

And return they do. Today’s shoppers do not hesitate to send back items that don’t meet their expectations—whether it’s a question of fit, quality, damage during shipping, or a host of other reasons. By all accounts, the e-commerce returns rate today runs well into the double digits, with some estimates putting it at 30, 40, or even 50 percent.

All this creates big headaches for retail-
ers. That’s partly due to the way they’re set
up. The sophisticated automated systems
they’ve designed for processing high vol-
umes of outgoing orders typically don’t run
as well when shifted into reverse. And ineffi-
cient processes are just the half of it. There’s
also the added labor, time-consuming work-
er training, the need to discount inventory,
and additional handling and shipping costs.

To get a better understanding of how companies are meeting the challenges of reverse logistics in omnichannel commerce, DC VELOCITY and ARC Advisory Group, a Dedham, Mass.-based technology research firm, teamed up to conduct our fifth annual survey on retail fulfillment practices. (See sidebar for more on our study.) Respondents answered 35 questions on their companies’ approach to meeting current challenges in omnichannel commerce and their plans for the future. Included in those questions were eight that centered specifically on respondents’ returns practices. This article will concentrate largely on the findings from that section of the survey.

SPECIAL REPORT By Ben Ames, Senior Editor

THE PROMISE OF HASSLE-FREE RETURNS MAY KEEP
CUSTOMERS HAPPY, BUT OUR LATEST SURVEY SUGGESTS
THAT OMNICHANNEL PLAYERS ARE STILL STRUGGLING TO
FIND THE RIGHT BALANCE BETWEEN COST AND SERVICE.