Online retail is still very much enjoying its moment, but the surge in ecommerce is sparking a worrying trend in the form of copious consumer returns that could cost businesses dearly. Jörk Schüßler, Marketing Director EMEA for Citizen Systems Europe, looks at how to optimise processes and cut the cost of reverse logistics with the implementation of special printer technology.
The latest statistics show that £133 billion was spent online with UK retailers last year, representing a jump of £18 billion from 2015*. That figure is expected to rise again by a further 14 per cent in 2017 in line with changing consumer behaviours, such as bringing the shop floor home, that are boosting online shopping’s share of all retail spending.
Recent research found that shoppers no longer think it is necessary to go to a store to “touch and feel” a product when buying, as they find it easier to order online and test items at home before returning unwanted units when it suits them. One KPMG survey revealed that 15 per cent of people said they bought more than one of the same product to try at home, 45 per cent bought two extra and 27 per cent ordered more than three extra, with the intention being to return those items that do not fit or suit at a later date**.
This rising number of customer returns is, however, already having a significant negative impact on the bottom lines of retail and parcel delivery firms as they are forced to recover the items and transport them through the reverse supply chain at additional cost to their business. Furthermore, the industry is being warned that returns will continue to increase as shoppers are now often entitled to automatic refunds for faulty goods purchased online. Ultimately, it is estimated that returns cost UK retailers as much as £60 billion each year, with £20 billion of that being generated by online sales.
As a result, it is essential that firms adapt to changing consumer habits to limit the potential damage that could be done. Passing the cost of return deliveries to the customer is not an advisable option as the majority of shoppers believe free and convenient returns are of utmost importance when choosing a store. Equally, free returns are one of the drivers behind the growth in online purchases and increase store traffic, so doing away with them would likely lead to negative consequences.
Instead, the challenges need to be tackled in alternative ways to ensure positive business performance, as well as customer satisfaction and retention. Implementing new technologies to help handle the reverse flow of products has been highlighted as one of the most effective ways of cutting costs and boosting productivity. Every tool used in the operation needs to be examined for possible efficiency improvements, as it is often the areas that are overlooked where the best outcomes can be realised.
Take labels, for example. If a retailer is using a system that sees a label included in the parcel, which the customer has to handwrite the return address on and stick on the package for return, there is a risk that the label will be hard to read, become damaged or – in the worst case – never make it back to the warehouse. A better alternative is preprinted, scannable adhesive labels with barcodes that contain all the information required to process the return. When the product arrives back at the warehouse, it just needs to be scanned to reveal all the details required to complete the return in minimal time.
This method is simple to introduce with label printers that ensure high quality print output of labels and barcodes to prevent misreads. Specially developed industrial desktop printers, such as the CL-S521, CL-S621 and CL-S631 from Citizen Systems, typically deliver the best results. These durable and reliable units are designed to offer optimum performance, with output speeds as fast as 150mm per second and printing at up to 300 dpi, in the harsh warehouse environment without maintenance.
This type of printer also provides maximum flexibility and compatibility, as well as easy integration into existing applications and networks within a warehouse thanks to standard on-board ZPL and Datamax emulations plus BASIC Interpreter programming support. Those models at the top end of the market also feature the capacity to store a range of logos and fonts for creating brand specific labels. Giving the workforce the right tools to complete the job quickly and effectively is a key element in optimising processes. With small changes – even down to the use of the right printers – the efficiency of reverse logistics operations can be enhanced dramatically to minimise the time and costs associated with returns and, above all, protect profits from the impact of this growing consumer trend. * https://www.uk.capgemini.com/ news/uk-news/imrg-capgeminie- retail-sales-index-uk-onlinesales- exceed-ps130-billion-in- 2016
CITIZEN SYSTEMS EUROPE