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Warehouse Returns Management Best Practices

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Returns Management Best Practices - Someone returning a parcel
Steve Thompson
Steve Thompson
December 23, 2022

Returns management is a part of logistics that handles customers returning products and deciding what to do with the items. Keeping returns in order is crucial for a warehouse to have solid accounting. Letting this part of logistics go astray can lead to lost profits, customers, and supply chain partners. Here are warehouse returns management best practices to consider for running an efficient commercial operation.

Pay Close Attention to Returns Management

Returning a box

Every brand or retailer must pay attention to setting returns management policies to resolve issues when a customer is unhappy with a purchase. Product defects and inaccurate order fulfillment are the leading reasons for product returns. Setting a win-win policy for the company and the consumer is essential. A broken product should at least be exchanged for one that works. If you don't have a returns policy, it can lead to awkward situations with retail personnel dealing with unhappy customers in public.

Returns management commonly takes the form of a supply chain process in reverse, also known as "reverse logistics." There are different return processes for public versus online establishments. Either way creates losses for your company, but losses multiply when you have no returns policy in place or don't address customer complaints. These days, warehouse returns management best practices recommend that business managers be cognizant of how quickly bad reviews spread online via review sites.

Emphasize Strong Customer Service

One of the most vital warehouses returns management best practices is letting customers return products that make them dissatisfied within a certain amount of time. Two-to-four weeks are typical deadlines for customer returns. By allowing customers to end up with their cash back or a better product, you can convert a negative customer experience into a positive one. That's important for achieving repeat business in the future.

Vital customer service is demonstrated through caring by sales agents and retail managers. You can win customers' trust and loyalty by allowing them options to get out of a bad deal. If you just cut them off, they'll go straight to competitors and tell several friends about their experience. Treating customers directly impacts whether they will ever buy from you again. Even one bad experience can cause people to explore alternatives or give up on a product.

Resolve Customer Complaints Quickly

Customer Service working

A customer complaint or a return increases the chance of them spreading negative comments about the experience via social media. The problem worsens when you give dissatisfied customers enough time to learn about better solutions from friends. To avoid conflict escalation, warehouse returns management best practices recommend immediate replacement of returned products. Doing so promptly will reduce the number of complaints and negative reviews.

Slow delivery service adds another negative to a miserable customer experience. Sometimes delays can happen because of bad weather or a truck breakdown. Other reasons may include labor shortages, extensive loading and unloading times, or scheduling mix-ups.

One way to reduce unnecessary wait times is to enter a drop trailer program. This process involves one distributor leaving a container at a shipping terminal for another to load or unload whenever they get to it. The parties don't have to rely on tight schedules in this scenario. It's a practical solution if your company or another distributor suddenly has a labor shortage. Not only does it avoid long loading or unloading wait times, but it also cuts costs and driving times. Additionally, it meets the requirements of the federal government's new electronic logging device (ELD) mandate for the logistics industry.

Overcome Logistics Deficiencies with a 3PL

If your company lacks modern technology used for logistics, it's advantageous to outsource to a third-party logistics (3PL) firm. It will speed up regular deliveries, and returns since 3PLs tend to offer speedy service as a reason to bypass traditional distribution channels. A competitive 3PL that aims for an impressive reputation and market share puts a high priority on distribution efficiency.

Many manufacturers that don't want to invest in digital technology like robotics or automation have chosen 3PLs as a cost-cutting alternative for product distribution. Some 3PLs use drop trailers to avoid scheduling conflicts with other parties. Ultimately, 3PLs and drop trailer programs provide convenience and flexibility in getting products from a warehouse to a retailer or a customer.

Inspect Products for Restocking, Repair, or Recycling

Man inspecting returned products

Once a product is returned to the warehouse, management must decide what to do with it based on an inspection process. If the return had nothing to do with a defect, the product could simply be restocked on a warehouse shelf or pallet. To maintain accurate accounting, warehouse management must ensure that the unit is added to the inventory count. Defective or damaged products may require further inspection to determine how the damage originated. From there, your team might send the item back to the manufacturer or a recycling center, depending on the condition.

Learn More About Maximizing Product Returns

Establishing warehouse returns management best practices at your facility will help overcome the negative impacts of bad customer experiences. When customers return products, your immediate concern should be converting the experience from negative to positive. Ideally, every return brings you new knowledge about your target market and how well you serve it. Keeping your warehouse well-organized with pallets is part of the solution to improving the customer experience. Visit a pallet factory near you to learn more about the connection between pallets and warehouse agility.