Understanding Reverse Logistics: A guide to online returns management

Online returns continue to be a major point of frustration for many online businesses that tend not to plan for it. Returns logistics, or reverse logistics, is a sophisticated process in itself that should be thoroughly explained and understood. How you go about managing the returns process directly affects your profit and loss as well as your customer loyalty.

First of all, returns should try to be avoided at all costs obviously, because it takes up time and money, right? This means making sure you deliver on what you promised and that you had good photos and descriptions of your products. Many returns happen simply because what was delivered wasn’t promised or presented in a clear manner. However, if returns do happen, you need to have a strategic process in place that ensures your customers remain happy, and you can restock and resell your products. On top of that, plans need to be worked out on what to do with excess stock that can’t be resold.

A recent report from IMRG revealed that online returns were on a meteoric rise in 2021. This reflects the obvious uptick of eCommerce sales worldwide due to Covid – meaning the more deliveries you have, the more returns you will have too. Returns are typically viewed as bad by most eCommerce sellers. However, the truth is that how you choose to handle this process could be beneficial to your business. It’s actually an opportunity to prove yourself. Handling online returns is an opportunity to show precisely how your business delivers on your customer service standards, no matter the issue.

Research reveals that 92% of customers will purchase again from a retailer if the returns process was easy. This statistic matters. Don’t just assume you will lose customers if they ask for returns on your products. Therefore, let’s discuss returns logistics and efficient processes for returns management.


Table of contents

1) What is reverse logistics

2) How reverse logistics works

3) Benefits of reverse logistics

4) Efficient reverse logistics management

5) The importance of returns logistics



What is reverse logistics?

Unlike regular logistics, which is all about delivering packages to your customers, reverse logistics (also known as returns logistics) is the opposite – moving the goods from the customers back to the warehouse or seller. This returns management process may be triggered for many reasons.

  1. If the product was defective and needs to be returned
  2. If the product was the wrong colour, shape, or size
  3. If the customer was just generally unhappy in some other way with the product

Unfortunately, in eCommerce, online returns are inevitable. The challenge for many logistics providers and sellers is creating a returns process that is efficient, cost-effective, and convenient.


What is returns management?

Returns management is the process and systemic approach of first determining how a return will be processed, then the execution of it. This will differ depending on who will receive the goods, what the return policy is, and what the customer preference is (if given multiple options). When the returns process is effectively managed intelligently and efficiently, it means a better customer experience, increased retention, and profits.


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How reverse logistics works

The reverse logistics process starts with the customer initiating their eCommerce returns or single return, and by the end, the goods will be received and processed by the seller, manufacturer, or 3pl.



1. The customer starts the returns process

Returns management starts with the customer determining why they want to return a product. They need to check the returns policy first to determine if they can return items. Some items may not be able to be returned and it always depends on the seller or returns contract. Once this is determined they will begin the returns either by mailing it, dropping it off in person (if possible), or arranging pickup (if offered). Mailing obviously costs money, and the customer may or may not get a refund (depending on the seller). Dropping off in person is obviously free (if possible), and new methods of arranging pickup may or may not require a small fee.

2. The return is received

The warehouse returns process is started either at the manufacturer warehouse, a physical stores warehouse, or a 3pl warehouse. For eCommerce businesses that use Shopify or WooCommerce and use 3pl services, the 3pl accepts the returns on behalf of their client’s customers. This then begins the quality check process for the return.

3. The return is checked

Warehouse returns procedures dictate that all items have to go through a quality check process to determine if the items can be resold. Products will be inspected for any type of damage, deterioration, or deformity. If there are no issues that have been found, online returns are sub sorted into items, based on their stock-keeping unit number, and will be readmitted into the stock for the specific vendor area. If items are damaged, however, they will not be returned to the regular stock area. They will either be trashed or repurposed. Some companies choose to donate some items to charity should they no longer be fit for customer use. This is a great way to reduce waste and positively impact communities.

“Products use precious resources which are becoming scarce and we are throwing them away unnecessarily.”

-Sarah Needham, Centre for Sustainable Fashion

4. The return is processed

Finally, using returns management software, the item can be added back to the original stock – assuming there are no issues obviously. The item is given a new SKU number and a refund can be triggered at this point.


Benefits of reverse logistics

benefits or returns logistics, returns management services, returns management in ecommerce, online returns, online returns policy, online returns centre, shipping logisticsThere are many benefits to an efficient returns logistics process. Proper supply chain management includes maintaining profit, reducing environmental impacts, and maintaining brand value. Recouping value is still possible through reverse logistics.

Customer satisfaction

Good returns logistics build trust with your customers. If a returns experience is managed well, they will shop with you again. You always have a chance to wow customers. That starts from the website to final mile delivery and returns.

Reduces monetary loss

Items returned in good condition can be resold – resulting in no monetary loss. The cost of providing refunds for mail delivery returns for customers can be a factor – however, it is minimal and still mitigates losses. Manage this with more clear return policies.

Environmental impact

We all have a responsibility to encourage sustainable practices in relation to waste. Instead of simply trashing items, more can be reused and repurposed. It is estimated that 5 billion pounds of waste are generated through returns each year.


Efficient reverse logistics management

Effective returns management for eCommerce is still a relatively new concept that begs for innovation. Clear policies and automation are great – but is enough being done? Companies don’t necessarily have a binary approach when it comes to online sales – only focusing on the first part of the journey.

The question companies need to focus on is “If online commerce makes it more convenient to shop from home and receive packages from home, why can’t the opposite be true?” This means if I can receive packages at home – why not send them back from home? This is the future of eCommerce returns.


62% of customers would choose courier collection as their choice of return service.


Return Robin

Selazars partner company Return Robin was designed for this purpose. Customers can manage and monitor multiple returns from home, saving them trips to the store or packaging returns for Royal Mail delivery. They innovate in the following ways.

  1. Returns can be submitted online: Customers can enter their return details and choose a date that suits them for return pickup from a courier, between Monday-Saturday – up to two weeks in advance.

  2. Customers get notified of a 2-hour collection window on their chosen date.

  3. A courier drives to the customer’s home to collect the parcel. No packaging label is needed as the courier prints and provides it.

  4. The parcel reaches its warehouse, and the return can be refunded within days. It can often take 30 days or more to receive refunds today after you mail it – so this is huge. Incentivise your customers more and they will repay you with more loyalty.

This is the type of innovation and convenience your customers need. Through awesome products, customer support, and great returns, you will create raving fans.


The importance of reverse logistics

Returned items need to be a larger focus for eCommerce sellers because it is an opportunity to not leave money on the table while pleasing your customers. Online returns can’t be viewed as an ad hoc measure – and need obsessive focus on the reverse side of the customer journey too. Refunds are inevitable, so offering great return policies and methods for customers earns trust and builds return business. If you want to learn more about reverse logistics for your business, schedule a free no-obligation discovery call today.

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Ecommerce Businesses need to make Parcel Returns Easier

It’s safe to say that Covid has changed everything. From business to travel, schooling to transportation, remote working to shopping, and beyond. We’ve had to completely rethink and reform how we go about our daily lives. All industries needed to evolve in some way to meet the needs of the changing markets. Now, it’s time for a better solution for returning parcels in the  UK retail market. UK retail must make parcel return easier and more convenient for customers.


Returning parcels

Many know that parcel return has historically never been an easy process. Covid made things even more complicated, causing further delays with shutdowns and long lines due to social distancing in shops.

It is too inconvenient for customers to take packages to a physical location, especially now with restrictions and long lines. It is too unsafe and increases the risk of further pandemic spikes. Typical parcel returns are also too slow, and customers want refunds back in their bank accounts quicker. How parcel returns are handled should be a key concern for online retailers. It is a highly significant key differentiator for UK businesses as well as a legal requirement for distance selling. Ecommerce businesses must dissect their returns policy to make sure they’re guaranteeing the best and most convenient solution for their customer returns.


“92% of consumers will purchase again from a retailer if the returns process was easy.”


This was a statistic released by the Interactive Media In Retail Group (IMRG). They know that online buying behaviour is increasing, and digital shoppers demand more from online retailers. They also said that 67%of customers check the returns policy before making a buying decision.

Not all retailers have a return policy and are not required to by law. However, the ones that do have a return policy will make you send a parcel to a mail location like a PO box or warehouse. Here it may sit for a long time before being reviewed, delaying customer refunds.

It is a must for online retailers to revisit their process of how to return a parcel. It will be more advantageous to a positive customer journey and the business’s profit margin.


Parcel return needs innovation

Nowaday’s everything can be brought to us in the comfort of our own homes. We order food online. We order toilet roll online. We order clothes online. We order electronics and other accessories online, and it arrives at our doorstep. It’s a very convenient time to be alive! We are afforded these great home delivery benefits in a modern 21st-century world. So, why doesn’t it work the same way with eCommerce returns?

The market has not quite innovated itself enough for the other half of the customer experience. Amazon does it’s best to do this on some level; however, it’s not uniform across the board, and they only cover customer returns to Amazon facilities. Few companies spend time on this other half of the online retail process. It needs innovation. For example, clothing retail.

According to a study by Sale Cycle in 2020, over 56% of online returns were clothing and shoes. What does this tell us?

It tells us that those 56% (millions) of consumers were partaking in a transaction that may or may not have led to future business with those retailers. It tells us that parcel returns are just as important as the products that are being sold. Why? Simply put, your customers will not return to you if it isn’t easy.


“82% of customers do not return to make another purchase if an online store has a difficult returns process.”


Sending a return via Royal Mail or the post office is time-consuming, and it can take up to 30 days or more for customers to finally see a refund in their bank account. Strategically, a package must travel from the customers home and then into a building like a post office where the package is then held. It must then be moved to a truck from that facility, then finally sent to the retailer. This process is antiquated and not sustainable as convenience and speed are critical factors for customer satisfaction nowadays.


Four ways UK online retail can offer a competitive parcel return process

Online businesses and retailers know that handling returns can be costly and create severe time constraints. Being able to stay profitable and focus on other business priorities can fall behind when managing the entire return process, from receiving the package to issuing a refund. It takes away from other stresses like marketing, customer service, and general administration.


“57% of retailers say that dealing with returns has a negative impact on their business’s day-to-day running.”


More retailers can take advantage of a tech-first solution that is quicker, safer, and easier than the typical return process. You can be more competitive in the marketplace by making customer returns as easy as possible. This is done through:

1) Automated parcel return platform

No one likes having to review a return policy on the retailer’s website, then have to find locations for the drop-off, and then figure out a convenient time for them to return a parcel. Returns management software helps manage the process more effectively and reduces errors.

2) Courier pickup

The courier goes to the customer instead of the customer finding time to do it in their own busy schedule. The customer either has to research retailer drop-off points or search “parcel drop off near me” and go out to do it.

3) Quicker return deposits

In an age of instant gratification the quicker the bank deposit, the happier the customer.

4) Offer free return shipping

Already being unhappy with an item is enough. Asking to fork out more money on top of that is just bad business. 58% of customers want a hassle-free “no questions asked” UK return policy.


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Return Robin

New service Return Robin offers the most innovative parcel return solution, efficiently managing the typical frustrations for retailers and customers. Return Robin is the new industry standard that includes all the benefits above of automation, courier pickup, and pre-printed labels. They even offer instant refunds.

Socially distanced returns

Return Robin was created in response to Covid-19. It allows people to return products without having to leave their homes. Spotting this innovation for online shopping returns, they were recognized and received part funding by Innovate UK, a government-funded project for these types of new strategies.

This benefit helps to prevent any further pandemic spikes during this challenging period in the world. Customers everywhere appreciate this, especially the older, more vulnerable demographics. Giving customers the confidence to buy and return online from their own home’s comfort and safety is an “above and beyond” service. This factor alone can future-proof your business by making it available to your customers. Return Robin also offers a uniquely integrated tech platform.

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Custom website integration

Custom website integration allows online retailers to merge their web portal with Return Robin. It’s a simple and unique design that makes it easy for anybody to sign up. It automates customs paperwork, EORI numbers, and product pricing information. Extra validation also ensures compliance.


The parcel return process

The Return Robin process is as simple as 1-2-3. This is how it works:

Step 1

Return Robin receives the return request from the customer. They only need to login onto the Return Robin portal, find their retailer and their product, and select it. The customer then schedules their own custom pick-up date and time.

Step 2

The customer is given a 2-hour window for pick up on the day of delivery. They put the item in their package, and then Return Robin collects the parcel at the customer’s home. Return Robin has already pre-printed the shipping label with all the product and retailer details and placed it on the parcel at pickup. They scan it and issue a refund.

Step 3

Return Robin then delivers the package back to the retailer within two working days! Having already set up an account, the retailer chooses precisely where they would like the return parcel to go.

As you can see, no more travelling for customers, no more long refund delays, and no more headaches. No further drop-off points or searching online for “parcel drop off near me.” Even your collect plus account can be integrated with Return Robin. The account will show up inside the Return Robin portal.

It’s perhaps time for online retailers to review their UK returns policy and free up resources by outsourcing to a 3pl like Selazar.


What is the average eCommerce parcel return rate?

One report has shown that 30% of all products ordered online are returned. Unlike brick-and-mortar retail, eCommerce requires customers to decide without physically interacting with a product. There are many reasons for returns. However, this is one of the biggest reasons why returns are so typical for UK retail online. Here are some of the biggest reasons for returns, according to a UPS survey of over 18,000 people.

Why do people return parcels?

Of 18,000 surveyed across 15 global markets, it showed:

  • 30% returned an item that was faulty or damaged
  • 27% returned an item because it was not as described
  • 27% returned an item because it was of low quality
  • 18% returned an item because of issues with delivery
  • 17% returned an item because they no longer wanted it

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Some industries tend to get more refunds than others. The fashion industry is by far the most common industry for returns.



Online fashion shopping has the worst return statistics

2020 was the biggest year for UK online shopping. According to Royal Mail last year, 61% of online shoppers returned clothing, and 35% returned footwear. Almost 4 out of 10 people said the clothing didn’t fit. Nearly 20% said the item wasn’t as described.

January is one of the most significant months for parcel returns. Many items bought with either gift cards or gifts given as presents from friends and family tend to cause a month of return headaches for retailers.

The new “try before you buy service” offered by many UK online brands such as BlackCart,  Stitch Fix, and Prime Wardrobe are slowly easing consumer worries about buying before trying physical products. However, there is still a significant uptrend of parcel returns. That is just the nature of fashion.

When customer returns do happen, sending back unwanted goods for free is preferred by 85% of people surveyed.


Preparing for the golden quarter and peak seasons

The time around Black Friday and the lead-up to Christmas are some of the busiest times for many eCommerce brands. To deal with the overwhelming surges of sales and returns, it helps to outsource to a third-party logistics provider. Extra demand means additional refunds.

A 3pl  like Selazar helps retailers with a better buying journey and encourages loyalty to their brand. The first impression with a brand many times if often during this quarter, so retailers need to ensure they are well equipped to deal with the demand.


3 Ways to reduce customer returns for your eCommerce business

Here are three powerful ways to reduce eCommerce returns for businesses.

1. Make secure packaging a priority

Depending on what products you offer, there are different packaging considerations. Whether it’s a single item or multiple items, you have to predict the shipping ramifications. Any products that are broken or damaged due to a poor packaging process are among the biggest reasons for returns. Damage can easily happen in transport or couriers could mishandle packages when the item is fragile.

2. Audit your product descriptions

Quality matters when you’re writing a product description. Make sure to include as much product detail as possible about all your items. Poor descriptions or descriptions that don’t match the products will lead to many online returns for your eCommerce business. Accurate product descriptions also increase conversion rates.

3. Quality test the products themselves

Customers will understandably be unhappy with an item if it appears to be of low quality. Low quality could mean anything from lousy printing to cheap fabric or scratches. Take extra care of the customers’ expectations for the products you offer, and you can significantly reduce your parcel returns.



Do 3pl’s offer parcel returns?

Not all 3pls offer customer returns. Companies like Selazar can return a parcel. They not only handle your inventory, but they assist with the customer returns process. The Selazar return management portal makes it easy for businesses to do this from anywhere. All the company has to do is log into their portal and approve the return. Handling customer returns is seamless integration with their advanced tech platform.

Return Robin is the sister company for Selazar; therefore, all customers will be able to use the Return Robin returns service with Selazar. Together these brands will help eCommerce stores and online retailers ensure quick and safe delivery for their customers. On top of custom packing, instant refunds, and superior service, customers will benefit from superior service – and so will your business.

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