Reverse Logistics Best Practices for 3PLs
There is no doubt that 3PLs are experts in shipping, as millions of e-commerce companies flock to find the most reliable 3PL. With that said, the issue of impending returns affects every business, even 3PLs. More and more consumers are becoming comfortable with returning purchases made online. According to Invesp, 30% of all products online are returned. Therefore, reverse logistics becomes increasingly important. As the name implies, reverse logistics refers to the method of repurposing or appropriately disposing of goods that will not reach their final destination, i.e., the customer no longer wants the product. As a 3PL, it is essential to demonstrate to your customers that you provide the best service by perfecting your reverse logistics. The following are our five best practices for reverse logistics provided by 3PLs.
Clean Inventory System
The physical and organizational integrity of your inventory system is vital to the successful management of your warehouses. Although bumps and hiccups are expected in any business, keeping this system organized can only benefit your reverse logistics program. The physical cleanliness of the space can minimize inventory loss and accounting errors regarding returned merchandise. Keeping up with stock on the 3PL level can also help e-retailers communicate to their customers when items become available again. For unpacking boxes and accounting for returned products, there should be a separate area within the warehouse. This should be a priority each and every day.
A Narvar study reports that 95% of polled online shoppers said they would continue to shop with a company when they have a positive return experience. A positive return experience involves hassle-free, constant email communication, a quick monetary refund, and good communication in terms of customer service. As a 3PL, you can control the hassle-free and fast monetary return part of the process by keeping up-to-date with returns, alerting the company, and alerts the customer. Good reverse logistics for your 3PL means good reverse logistics for your companies. This results in repeat customers, a positive reputation, and a growing business.
In general, many companies choose to work with third-party logistics providers because they are experienced in reverse logistics. Processing returns can often be overwhelming and require many employees to sort through, and storing the return boxes and packages before processing can take up a lot of space. It is estimated that 30 percent of all online products will be returned, making 3PLs obligated to handle those high volumes. If you are a 3PL and unable to handle the level of returns you are receiving, you need to look into scaling up your resources. Having scalable resources for a 3PL company includes hiring more employees and expanding physical warehouse space. Increase your resources to keep your customers satisfied and your process more manageable.
Businesses can benefit from parcel management in a variety of ways. Typically, when it comes to third-party logistics providers, it means cheaper shipping rates due to the large volumes of goods. As the demand for free shipping AND returns increases, it can become quite expensive to offer free returns. To facilitate easier returns, we suggest 3PLs should instead forward their discount shipping rates to retailers they do business with. Reduced shipping rates will attract more companies to your fulfillment center.
Employee Logistics Training
Training is essential for your employees! It is not merely a matter of training them to put this code into that box; we mean to make them logistics experts. Employees are immersed in the daily work and shipments, and they have the most experience. You can reduce errors and increase the efficiency of your business by empowering your employees. Your employees will likely notice errors in your supply chain long before the CEO does. As part of your overall warehouse management strategy, it is vital to continue improving reverse logistics while training all employees to be logistics experts.
We have saved the best for last. Technology is vital for the success of 3PLs. You must utilize technology that is both functional and user-friendly. Look to partner your WMS with a shipping-solution based OMS for a smooth reverse logistics workflow. While a WMS is a program that helps your 3PL warehouse with inventory management and overall organization, Order Management Systems (OMS) are used by 3PLs to help them manage multiple companies' orders and help facilitate reverse logistics. Shipping solutions often have built-in OMS integrations and can help you rate shop, automate orders, batch ship, and perfectly sync with your favorite shipping-related technology, centralized in a single place, to enjoy all its advantages. In terms of helping your reverse logistics, a shipping solution like DesktopShipper can create prepaid return labels and rate shops for the best price to get the package back to the warehouse, saving you both time and money. If the return label isn't used, then the payment never goes through, and there's no harm, no foul. It is also possible to create individual account profiles for your retailers, preventing returns from being mixed up and eliminating inventory errors. Shipping solutions can save your 3PL time, money, and headaches.
As an e-commerce business reading this, you are probably already aware that reverse logistics 3PLs possess advantages. If you are a 3PL, you are probably taking steps to make sure that all your ducks are in a row and that you are the best in the industry. E-commerce sellers and 3PL providers alike are still looking for ways to improve reverse logistics, and both are trying to figure out the best way to accomplish it. By following these best practices, you can ensure that your customers and their customers remain satisfied.