How to Create an Effective Returns Policy?

product returns 300x289 How to Create an Effective Returns Policy?Its true that returns are expensive, as they tax the retailer’s resources and lead to lower profit margins in the short term. However, retailers need to understand the importance of  efficient returns-handling in building customer trust and enhancing lifetime values. They should know that when a customer isnt happy with a product and returns it, they have to act quickly and efficiently to process the return. Efficient returns play a key role in managing the inventory efficiently – balancing forecasts and return rates within the inventory levels serves well to prevent overstocks and backorders – ensuring that the customer will come back for more. Here are some tips to streamline your ‘Return’ policy.

  • Communicate with customers about the return processing through information on pages, on receipts, or within a packaged delivery product.
  • Keep the process and terms simple. Placing a code on return labels expedites return process when multiple systems are involved.
  • Identify reasons for returns. Data collected should be used to calculate costs of returns which in turn aids the action plans.
  • Return processes should be quick as customers would be low on patience. They are more likely to shop with the same retail merchant again if the return process is convenient.
  • Cross channel returns enable flexibility and variety on the shopper’s part, giving more reasons for the customer to purchase another product from the same retailer.
  • Smart returns – for e.g.  Innovations like bar-coded labels, which can be sent online – also would help to make the customers more comfortable and assured of the return confirmation.
  • The merchant or manufacturer or a third party fulfillment service provider can be sources to handle customer returns, thereby increasing the number of options for the customer to easily return the product

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