Unlocking Value in Merchandise Returns

Over 8 – 15 % of a Retailers Sales are returned for various reasons. This can cause both a negative sales impact, and an increase in expenses. However smart strategies leveraging transaction information
and the best of analytics can help manage Returns leading to a significant boost to the bottom line.

As an illustration - for a $1B annual revenue retailer; the impact to the bottom line in terms of increased revenues and lower expenses can be as much as $20MM.

Click here for more details.

A few areas where analytics can positively impact Returns:

1. Treat Returning Customers Differentially

• Handling product returns should be an important component of a retailers CRM strategies
• Retailers should capitalize on product return occasions and treat them as additional touch points to strengthen their relationship with customers

2. Encourage Cross-channel synergies

• A cross channel return policy will create cross-selling opportunities. For example, retailers can encourage customers to shop in stores when they come to return online and catalog orders

3. Minimize Fraudulent Returns

• Fraudulent and abusive returns cost retailers approximately $10-15B annually, accounting for nearly 10% of the return dollars
• 30% of the top 100 retailers actively use a returns solution that can verify if the receipt is valid, but cannot intelligently advise the store about the validity of the return

4. Minimize additional expenses related to returns

• Handling returns costs US retailers over $165B each year
• Expenses related to returns such as product repackaging, markdowns and item disposition cost retailers even more