Return orders can be a nightmare for any business. But, they are inevitable. When you’re running an eCommerce business, you have to be prepared for return orders and come up with strategies to manage them. If you’re using a 3PL logistics platform, chances are they are handling the return orders for you. Alternatively, you have to do it on your own and it is something you can’t leave unchecked. In other words, you have to figure out a way on how to reduce return orders for your online business.
Return orders can be your worst enemy since they hamper your business to a great extent. They lower your profit margins, and most of all they can lead you to a point where you are n longer making profits. Therefore, eCommerce can seem like a huge burden to you. And you might even want to give up on your idea of running an online business.
In fact, research suggests that a majority of eCommerce businesses shut their business within 6 months of their launch. Believe it or not, return orders have a huge role to play in this. This is why most companies keep on wondering how to reduce return orders.
To first understand how to reduce return orders, let’s move ahead step by step. We first need to understand what are return orders and how they impact your business. Then we have some inside tips for you that can help you reduce your return orders significantly. So, let’s get started!
What are eCommerce Returns?
If you’re new to eCommerce and wonder what eCommerce returns, you’re at the right place. Before you can move ahead and find out how to reduce return orders, you must know what these are.
If you are new to eCommerce, this is the part where you pay attention. eCommerce returns are those orders that travel the reverse journey of the traditional order fulfilment process. These orders are sent back from the customer to the seller.
Forward Logistics
Traditionally, a package delivery system works as below-
- The customer places an order on the website of the seller.
- Seller receives an order and starts working on it,
- They pick and pack the inventory and keep informing the customer about the status of their order.
- Similarly, they choose a shipping company and forward the order to them.
- This means, they dispatch the order and hand it over to the courier company for delivery
- The courier company takes it to their hub where it is sorted and shipped for the correct destination.
- Finally, the package reaches the delivery destination hub of the courier. From there it is taken for last mile delivery.
- The order fulfilment process finally completes with the customer receiving the order.
Reverse Logistics
In the case of reverse logistics, the entire flow is reversed. In other words, this is what happens-
- The customer received the order
- Due to a variety of reasons that we will discuss in the next sectio, they decide to no longer keep the product.
- They place a return request with the seller, either manually or through a procedure on the online store
- The seller arranges for a pickup. Alternatively, they might ask the customer to ship the order at the seller’s address
- The courier representative picks up the order and takes it to the courier hub
- It is then sorted out and shipped back to the seller’s address
- Finally, the seller received the package
- They are then supposed to issue a refund to the customer for their product. In maximum cases the seller bears the shipping costs. They might choose to issue an additional refund to the customer, if the customer is the one to ship the order
Due to their very nature, return orders can be stressful for any business. After all, not only the opportunity cost to make another sale is lost but also an additional burden of shipping costs imply. This is why as an eCommerce seller you must focus on how to reduce return orders.
Why Pay Attention to Returns?
Return orders must be paid attention to, for a variety of reasons. If you leave them unchecked, they will slowly eat into your business and put you in an uncomfortable position. Take a look at the other factors below-
Reduced Profits
The first thing that comes with returns are the reduced profits for your business. In other words, if you are getting too many returns, it means that you are not making a lot of profits. Because as a seller you have to provide free returns to your customers, to stay in the business. When you do, you are the one bearing the cost of reverse logistics.
Therefore, you have an additional expense on your shoulders. Moreover, the more return orders, the more this expense grows. Ultimately, this reduces your profit margins and hampers business growth.
Bad Experience
If you are receiving too many returns, chances are you are providing your customers with a bad experience. Most sellers don’t focus on how to reduce their return orders, and end up ignoring why they are receiving returns. It might be due to a bad product from the manufacturer, Alternatively, it might also be due to the negligence of your logistics partner. Pay attention to the origin of your return orders and start working on them.
Business Hassle
Return orders create a lot of hassles for your business as well. As an online seller, you start with simple goals in your mind. These are to make money and satisfy your customers so that it leads to business success. But, when returns come into the picture, it destroys the entire experience. You now have to focus on bringing the order back from the customer, processing a refund and more. In many cases, you will be required to set up an altogether automated pipeline for the process. Moreover, the mose the number of returns, the more business hassle you have to face. For this reason, you must focus on how to reduce return orders.
Steps on How to Reduce Return Orders
Once you understand the importance of returns, you can quickly take the measures towards reducing them. This will create a positive experience not just for your customers but also for your business. Here are a few smart ways that will help you answer your question on how to reduce return orders-
Understand How eCommerce Shipping Works
The first and foremost thing to do is understand how the entire eCommerce shipping process works. If you are not through with it, take a look above. A lot of factors come into the picture, when you ship a product. Be it the choice of a courier company, your packaging, delivery timeframe among others. You cannot choose to ignore a single aspect of your order fulfilment strategy. Even if you are outsourcing these services,it is advised that you get your hands dirty with the actual process for some time. This will give you a taste of the real experience and help you understand the cause of your returns.
Hire a 3PL
Hiring a 3PL can help you sort out your woes on how to reduce return orders. This is because they will be taking care of your entire shipping process and helping you optimize it. For example, a 3PL like Dash101 will help you ship with 7+ courier partners to 26000+ locations in India. This can help you make the right choices when it comes to your shipping strategy. Once you put the right foot forward, it will become easier for you to provide quality experience. In other words, you can ensure your packaging and shipping services and reduce returns significantly.
Dive Down into Statistics
Get your hands dirty with shipping statistics. While you might know which of your products are best selling and why, it is also important to understand return orders. Figure out whether one particular product of yours is being returned more often than the others. If this is the case, speak to your manufacturer or wholesaler to keep a check on the quality. Alternatively, there also might be some customers who create nuisance in your business. Figure out if that is the case and block such customers instantly. This will help you sort out your worry on how to reduce return orders.
Package Properly
Packaging plays a key role in your business. Poorly packaged goods can lead to ecommerce returns, without you even realizing. And this might not be your courier company’s fault, if you are the one packaging the goods lightly. Make sure that you buy the right kind of packaging for the right kind of material. If you are shipping fragile items, add filters to your packaging to avoid any breakages in the transit. Alternatively, you can ask your customer to submit a reason for their return. This will provide you with feedback on your packaging practices.
Have a Clear Return Policy Page
Having a clear returns policy page helps in simplifying the return orders. Alternatively, it also helps in reducing your woes on how to reduce return orders. Have a clear returns policy page that states the terms and conditions for return orders. For example, you might tell your customer that you will only accept returns if the product is damaged or broken. In cases of size issues, you might only exchange the product.
Ensure Timely Delivery
Delivery timeframes can also lead to returns. Make sure that you fulfil your promise of delivery when it comes to your online business. Provide your customers with realistic timeframes for delivery. Make sure it depends on their delivery region. Timely delivery ensures that your customers receive the products just when they need them.
Conclusion
How to reduce return orders is a question that is answered best depending on the nature of your business and existing services. While these strategies will help work on them, it is best that you understand the cause of returns in the first place. Then use a reliable shipping platform like Dash101 that can help you lower your return orders to a great extent!
