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How to Optimize Your Returns Process

Discover how to improve your post-purchase experience and build customer loyalty. By Rachel Go December 7, 2023

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Returns are a no-win situation. Unhappy customers have to go through the hassle of returning their purchase, and merchants have to deal with the lost time, inventory, and revenue that comes with the return. According to the National Retail Federation, online purchases are returned at a rate of 17%, which means for every $100 you earn, you should expect roughly $17 in returns.

However, managing returns is an inevitable part of doing business. WBR Insights found that 89% of buyers are less likely to shop with a business after a poor return experience, whereas a positive return experience encourages 97% of consumers to purchase again.

While vital to retaining your customers, returns are also instrumental in acquiring them in the first place: A ZigZag returns study revealed that 79% of consumers check your return policy before making a purchase, and if they don’t like what they see, almost half won’t complete a purchase.

Your return policy thus drives conversion, and your returns process retention. With that in mind, let’s discuss how you can optimize your overall procedures to improve your post-purchase experience and build customer loyalty.

6 Key Components of an Optimized Return Process

Below are a few important factors to consider when offering returns to ensure a seamless process for all parties involved.

1) Create a clear return policy

The first component of a successful return process is a clear and well-written return policy. This is the agreement between your brand and buyers around what is acceptable for returns, timelines to follow, and other requirements for a refund.

Your return policy should set expectations for shoppers and be easy to understand. Avoid technical legal jargon that’ll make your readers’ eyes gloss over; instead, write in a way your consumers will clearly comprehend.

The goal of the policy is to outline the parameters for your return program. If someone wants to make a return, they should be able to defer to your policy and quickly understand how returns work, what you accept, and what you don’t allow.

2) Display your return policy strategically

Your return policy is useless if no one reads it, so ensure your policy is easily accessible and displayed at key points during the purchase process.

Exhibit it on your website, such as on a dedicated page with a link to it from your footer. That way, when someone looks for it, they can easily scan your footer menu and click through to read it.

Then, link to that page in the checkout flow. For example, add a simple line below your shipping information that says, “Find our return policy here” and hyperlink the text.

Consider incorporating links to your return policy in your confirmation and delivery emails as well, along with other pertinent information. If you have automated emails set to let buyers know when their delivery is expected, insert links to useful information below their shipment tracking details. In addition to your return policy, this can include links to how your product works, where to leave a review, and more.

3) Clarify between returns and warranty

Instead of limiting your policy strictly to returns, you can add warranty procedures as well. With a return, you promise a straight refund, whether or not a customer sends an item back. With a warranty, you promise that customers can send in their item for a repair or replacement if an item doesn’t work or stops functioning within a certain period.

Offering warranties can make your reverse logistics ecosystem more complex, but it can be beneficial. For example, warranties are a worthwhile investment if you sell high-value items or customized and hard-to-find goods.

For this option, you need to be strategic about items you receive from customers, such as keeping them for parts to repair other goods under a warranty. As an example, a returned suitcase has inserts, wheels, handles, and other working items that you can use to repair a damaged suitcase under warranty.


4) Determine whether you want goods returned

Should you require items to be returned before you process a refund? The answer depends on a few factors.

Requiring goods to be mailed back could cost you more than just the value of the item, as 87% of consumers are less likely to shop with a brand that doesn’t provide free returns. Shoppers expect easy and free returns, which means your business is on the line for the reverse logistics.

On the flip side, allowing customers to keep your product can open up your brand to higher rates of return fraud: Someone could read your return policy, make a purchase they want to keep, then ask for a return knowing they’ll get their money back as well as the item in hand.

Ask yourself: Will it be more expensive to require items be sent back before processing refunds, or are you willing to risk increased return fraud to offset the additional manpower it would take to process those returned goods?

If you decide to require customers to send items back, look into return management programs that come with discounted shipping and consider defaulting to the cheapest standard shipping rate. If you have retail stores, you can also encourage shoppers to drop off their returns at your brick-and-mortar locations (which you could code into your policy).

If you decide to let customers keep the items instead, you can request photo or video evidence of the defective product before releasing a refund. You should also clarify in your policy what will happen if you discover fraudulent claims and track your returns to see if any common names, emails, or addresses return goods frequently.

5) Determine parameters for relisting goods

No one likes wasting inventory, especially a best-selling item that’s already low in stock. To reduce waste and make your inventory last longer, consider evaluating and re-adding returned goods to your inventory pool.

This can get tricky though. If you take this route, be sure to place strict quality control standards on all returning products. You can also look into adding tamper-proof seals to know if consumers opened the packaging, such as stickers that go on the opening flap of a box that immediately rip and leave markings once peeled off.

Additionally, you’re limited to goods that clearly indicate whether they’ve been tampered with. So, you may not be able to resell a laptop as new (although you could reset it to factory settings and resell it as used), but you could resell a mug that hasn’t been removed from the original packaging.

6) Partner with a reliable logistics service

For seamless returns, work with a reliable partner who can handle all your logistical needs under one point of contact.

Ideally, whoever handles your prep and fulfillment should also take care of reverse logistics, especially if you enact warranties in addition to refunds. That way, they can oversee the quality control of items shipped, reinspection of returned items, storage of returned goods for warranty fixes, and the readdition of qualified returned products (for example, external packaging still sealed) back into your inventory pool.

A partner like MyFBAPrep is able to manage your returns and reverse logistics expertly while simultaneously handling your marketplace prep, DTC fulfillment, retail replenishment, and more. Many of our clients leave the entirety of their logistics to us so they can focus on growing sales, adding new products, and scaling their brands — to great success.

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About the Author

Rachel Go is the marketing director of MyFBAPrep, an eCommerce warehouse network for Amazon aggregators, enterprise brands, and top Amazon sellers. Operating a global network of more than 100 warehouses and 85 million square feet of operating warehouse space, MyFBAPrep offers a full suite of eCommerce 3PL services, including Amazon wholesale and private label, direct-to-consumer (DTC) fulfillment, and B2B retail.

Wrapping Up — Make Your Returns Process a Selling Point

Returns don’t have to be the Boogeyman for your eCommerce business. They can instead set your company apart and, when done well, keep customers coming back for more.

Follow the tips we’ve outlined above to transform your returns from a nightmare into a dream for everyone involved.

Powered by their SaaS technology platform Preptopia™, MyFBAPrep sellers gain access to unified billing, analytics, business intelligence reporting tools, and real-time inventory snapshots across multiple warehouses in the network. The company provides FBA Prep automation, modern robotics item picking, and a dedicated account management team. Based in Coral Springs, Florida, MyFBAPrep moves over $1 billion in gross merchandise value (GMV) and processes over 10 million units annually.

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