How To Prepare Yourself For Peak Returns Season

Jan 11, 2019

Header Image Credit: Transport Executive.

The peak returns season is currently underway, with billions of dollars worth of unwanted Christmas, Black Friday and New Year presents globally set to be returned to retailers.

This puts significant strain on retailer’s delivery networks and logistics infrastructure on how they are going to cope with a sudden increase in goods being processed.

Logistics carriers struggle to cope with the surge of online shopping and demand for faster delivery times.

“Warehousing, logistics and online systems are all built to cope with average levels of demand, and so come under a lot of stress when volumes rise significantly,”

Neil Saunders, managing director at GlobalData Retail.

National Returns Day – a day designated by US delivery giant UPS to represent the ‘highest spike of returned packages for the entire year, falls on January 3. This marks the second wave of returns following Dec 19’s returns of up to 1.5 million parcels in a single day.

In the UK, 387 million parcels are expected to be delivered by retailers, an increase of 13% from 2017. Likewise, UPS expects to deliver nearly 800 million packages globally between Thanksgiving and New Year’s Eve; 38 million more than last year.

The growth of e-commerce has left logistics carriers struggling to cope with increased parcel volumes, especially during the peak festive season.

How does this affect you? Let us explain:

The delivery process of product returns matter.

Along with facilitating the sending of your products to your customers, how you handle the delivery process of product returns is equally crucial.

Your customers may have unwrapped their presents and are counting down to the new year, but as a retailer, your work is not done yet.

With a rise in orders globally also means an overall rise in returns for both logistics carriers and retailers.  For retailers, January and February mean holiday hangover.

You need to be prepared to manage product returns, overstocks and recalls typically between January and early-March. Data from Inbound Logistics show that companies can handle up to 45 percent of the year’s total return volume in the first three months of the year.

Customer’s delivery experience influences whether they will return to shop again

A survey by Drop-off revealed customers see the delivery experience as a reflection of the retailer, with 43% of consumers saying they will never shop at a retailer following a negative delivery experience.

Unfortunately, consumer’s delivery experiences thus far have fallen short of their expectations. They have seen a rise of sub-standard delivery experiences; whether be it late deliveries, parcels arriving damaged, missing or receiving wrong orders in 2018.

Fast, reliable delivery sway consumers to buy from a particular retailer. The same holds true for returns. Clearly, how your logistics providers perform during the delivery process reflects on your brand’s service quality and determines whether customers come back to you again.

Furthermore, customer’s expectations on delivery are growing. A 2018 PwC study found consumers expect their purchases to arrive promptly and are also willing to pay extra for faster delivery.

Do you have transparency over your parcel volumes and how your carriers perform?

Peak shopping season may be over, but the peak returns season is happening now. Concerns around delivery are critical especially if you deliver within dense urban areas where demand volume is rising fastest and the delivery infrastructure challenges are the greatest.

Now is a good time to re-evaluate your delivery and logistics efforts to cope with rising consumer expectations in a safe and profitable manner.

If your customers place such high importance on the delivery experience, are you allocating enough resources to get visibility on the entire process?

Some benefits of a carrier management platform:

  • Easily manage customer’s delivery (and return) expectations and provide proactive forecasts on delivery transit time

  • Anticipate customer inquiries on delivery status and ease the workload for your customer service teams

  • Transparency on logistics performance allows you to negotiate better rates and service level agreements with your carriers

For instance, with detailed parcel analytics, you’ll get complete visibility on key logistics KPIs including an overview of how many parcels your logistics carriers are handling or parcel volume across different markets and regions. You’ll be able to drill down into the specifics of each carrier; how long they take to deliver a parcel, how many successful deliveries they have and why other deliveries weren’t successful.

With these reports, you never have to wonder how your carriers are performing ever again. Keep your team (and management) in the loop while making data-driven decisions and keeping abreast of your logistics.

Stay competitive by getting transparency on your parcels during the peak returns season

To stay competitive in the peak returns season, every part of your e-commerce process must be top-notch; including your logistics processes.

For more exclusive reports, insights, and interviews on the latest updates in e-commerce and logistics, follow us on LinkedIn or join our community as a member.

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