"How to drive customer satisfaction when handling returns"

This is a headline that seems, somewhat, like a ‘no brainer’ and something that most people would agree to, but it masks the real issue and it does not capture the actual issue and the real complexities of reverse logistics. 

‘Reliability’ is a term that is used in business because most companies will feel comfortable with it since, they think, it can be measured. “95% of returns are processed on time”; “97% of refunds are issued within X days” may sound good on most score cards but they miss the customer point of view. For an average on-line customer placing 3 orders per year with only one failed returns process this means “66% processed on time” and “66% refunds issued on time”. Much worse and certainly not fit for their score card!

So what is fit for the customer score card?

One thing: No worries whatsoever about any purchases and the consequences of it at any time. That translates into a potential customer clicking the buy button now; on this website instead of another. Conversion!

Having conducted research and evaluated customer sensitivity to a combination of returns propositions, the “no worry factor” always came out ‘tops’. A ‘guaranteed-no-questions-asked’ with free return shipment and fast refund proposition drove a 70% conversion. Add ons like ‘free voucher for a discount for next order’, ‘discount on next listing’, moved the needle at a 1% at best. So: too complicated, not interesting.

So, there we have it. If anyone needed it, another confirmation of how important for conversion (and therefore sales) it is to take into consideration all the worries of a customer. Inevitably that leads the question of how affordable a liberal, ‘no worries’, returns policy is, what it costs and what financial returns can be gained from returned products.

To complicate matters, in the EU, WEEE and REEE regulations stipulate what can legally be done with, especially, electrical goods. Collecting, registering, categorizing, refunding, scrapping, certifying, refurbishing, repairing, remarketing of returns are processes that are entirely different from the core competencies like sales and (outbound) distribution to customers and r(e)-tailers and therefore specialized reverse logistics companies can often add real value to the manufacturers / retailers business by “funding” a liberal returns policy through extracting maximum value from returned products.

There are many companies out there offering a good financial return for a returned product however. Given the complexities of EU regulations and the value of good visibility what customers return a business it is well advised choosing their reverse logistics partner well because, in my opinion, good quality of returns data, product fault analysis and customer feedback is worth much more than a higher yield “per ton” or, per GBP / EUR per item at a first glance.

Going back to what the end customer is looking for; “yield per returned item” will not be on their score card. Good processes, a reputable supplier, ease of mind and ‘no worries’ are.

About Thorsten Runge

Starting his career in logistics operations in the UK in 1993, Thorsten Runge moved on to manage HP EMEA Logistics in 2001 where he built both fulfillment centre and transportation operations. In 2005 he joined Amazon where he developed Amazon’s transportation network in Europe. He now drives the build out of reverse logistics services at the Reverse Logistics Group (RLG) who recently acquired Britcom.

About Cycleon

Cycleon is an international supply chain and service integrator supported by a reverse logistics platform. Cycleon has a track record in developing and executing optimized end-to-end returns solutions, essential to improving and maintaining customer satisfaction and experience. Cycleon offers best-in-class reverse logistics solutions that meet changing needs in service, commercial, ecommerce, end-of-life and product recall returns.