Free Returns?

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Most people think sales and deliveries are the only key drivers of peak success, but returns – or “reverse logistics” – can make or break a retailer’s profit goals. A recent study found 79 percent of shoppers surveyed view a free and effortless return policy as an important factor in online retailer selection and purchase decisions.

Online retailers must provide an acceptable returns policy to stay competitive – but just as there is no such thing as free lunch, there is no such thing as free returns. For retailers, reverse logistics are another cost of attracting and engaging customers. The surge in eCommerce, and the resulting surge in returns handling, is driving demand for dedicated processing warehouse space around the world. Faced with the daunting yet customer-critical task of managing returns, retailers have two basic options: self-perform or outsource.

Impact in EMEA:

In the UK, survey data finds that 26 percent of retailers have experienced an increase in returns in-store and online over the last two years, with the number of returned items up an average of 22 percent. The so-called ‘Phantom Economy’ of reverse logistics is a global challenge.

Impact in APAC:

Remarkably, return rates in Asia are well below those in EMEA and North America, with most shoppers returning 10 percent or less of their orders. Yet two-thirds of shoppers surveyed in Asia indicated free returns shipping is important when selecting online retailers. The massive retail market in Asia – online and in-store – faces the continuing challenge of providing customers fast, seamless and free returns experiences.

This article was featured in The Edge, Cushman & Wakefield’s global magazine.

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