11 - 12 September, 2019
44 (0) 207.368.9894
Cross-Border Customer Returns and Online Retail: Supply Chain Challenges
Online retailers are having a busy time of it, scrambling to cope with the logistical and process supply chain demands of a growing marketplace for e-commerce.
An inevitable and important part of the customer delivery ecosystem is the management of returns – a process that's set to become even more challenging as consumer practices move e-commerce boundaries between international borders.
The Growth of Cross-Border Ecommerce
The 2016 Pitney Bowes Global Online Shopping Study of thousands of consumers from over a dozen countries suggests that cross-border ecommerce is becoming an increasingly popular activity world-wide. Two-thirds of those surveyed made online purchases across international borders, and 58% of respondents did so on at least a monthly basis.
There's a lot of opportunity for e-tailers to capitalise on this trend – but also a number of complicating factors that need to be managed.
Website, or Marketplace?
With online marketplaces, the wider choice of retailers and products, alongside features like loyalty points,one-click purchasing and discounts offered in a "virtual mall" are big attractors for customers. But the opportunities for more personalised customer service, branding, and the creation of long-lasting relationships that a dedicated company website can provide are also worth having. A dedicated website also means closer control over record-keeping and supply chain logistics for outward- and inward-bound goods.
In-store Global, Online Local
The continuing pull between bricks and mortar retail outlets and e-commerce takes a particular twist in the form of "in-store global, online local" buying practices adopted by international travellers. Here, goods identified during visits to physical stores in cross-border locations are earmarked for purchase via that same store's online presence back home.
Identifying Customer Pain Points
A significant part of the challenge for successful online retailers lies in dealing with the needs and expectations of dissatisfied customers. Queries, complaints, technical support issues, and ultimately the return of defective, unsatisfactory, or unwanted goods pose a particular problem in cross-border transactions – from language and translation issues with staffing and the construction of knowledge bases, to the actual logistics of receiving and handling returned merchandise.
Complying With Local Laws
Cross-border returns policies must also take jurisdictional and regional laws into account. For example, the European Union currently enforces a mandatory period of 14 days within which goods purchased online may be returned or exchanged without incurring charges. But there are local variations on this, notably in Germany, where customers expect the right to return goods up to 30 days after delivery, unconditionally.
Issues like VAT and customs duties paid by cross-border buyers also need to be addressed, especially in cases where these additional charges can be claimed back by customers returning merchandise. Having a tax consultant on-board to assist consumers in negotiating the "duty draw-back" process can significantly improve the customer experience.
At eTail Fulfilment and Returns 2018 we’ve got some of the leading minds in delivery and returns on one panel to discuss ‘How will Brexit impact the European logistics industry and the cross border strategies of eCommerce retailers?’ Moderated by James Hookham, Deputy Chief Executive, FTA, and featuring Sue Roberts, Supply Chain Director, Majestic Wine and Gabriel Tellier, Logistics Director, PhotoBox. Download the agenda to find out what other great sessions, speakers and activities we’re planning this year.
"Cross-Channel" Returns & Exchanges
The multi or omnichannel marketing strategies being adopted by many online retailers don't only raise questions about consistency in pricing and inventory across various platforms, but also about consistent approaches to dealing with customer dissatisfaction.
A consumer wishing to return or exchange an item they've purchased online naturally assumes they should be able to do so remotely, or in-person at a physical store – and they'll expect the same rapid response and standard of service in all cases.
Whether the online merchandise in question isn't usually in-stock at the company's physical outlets isn't the issue – the e-tailer is simply expected to make good on the (universally applicable) terms of their omnichannel returns policy.
The Importance Of Supply Chain Visibility
Meeting expectations like these puts a firm emphasis on the supply chain, which has to be visible enough at all stages to satisfy the demands of both forward (sales and deliveries) and reverse (returns and exchanges) logistics.
Achieving supply chain visibility for multiple sales channels requires knowing where the goods are, how efficiently they're being moved around, and whether the time-frames involved in shipping them from distribution or consolidation centres are satisfactory for customer fulfilment. Merging inventories from all outlets (physical and virtual) on a single software/analytics platform is a great way of doing this.
Creative Transportation & Outsourcing
Calling on partners and third-party logistics (3PL) providers to operate regional or in-country return centres is one way of ensuring that the inspection of returned items and the issuing of refunds may be done more quickly and on a local basis for cross-border returns.
Establishing local return centres at various geographical locations also enables e-tailers to consolidate returns at these nodes and assemble bulk packages for shipment back to their regional or domestic headquarters. This eases the burden on transportation networks (fewer journeys required) and creates significant cost savings (fewer packages to deliver).
Local inspection also allows fraudulent, defective, contraband, or unsellable return items to be identified earlier in the supply chain, and can prevent the unwarranted shipment of such goods back to the home country.
Recycling the Returns
Consolidation and local inspection of returned goods may be integrated with recycling or refurbishment activities to make items available for possible exchange to satisfy the needs of return customers in other locations, and other methods of re-purposing or disposal. These might include putting sell-able return items on special offer, or the donation of perishable goods to local charitable organisations.
Collecting & Disseminating Information
The gathering and analysis of data on returned items has the potential to greatly inform decisions on how to prevent or reduce the return of items in the first place.
It's impossible to cover every eventuality for returns, for example some customers purchase several items online for the express purpose of selecting a few and rejecting the others. However, evaluating customer feedback and a study of the merchandise may reveal quality control issues, usability problems, or market trends which may be addressed via a redesign of a product, improved documentation, or the promotion of product lines having more traction in specific regions.
Returns Merchandise Authority (RMA) Processes
Logistics and quality control aside, putting in place a transparent and convenient returns process is crucial to maintaining customer satisfaction and loyalty for domestic and cross-border sales. Establishing a web-based returns process eliminates complications which cross-border customers may have when calling customer support lines in different time zones, or juggling the physical aspect of packaging labels for return shipment.
A Returns Merchandise Authority (RMA) policy like this can incorporate practical measures like the cloud printing of return labels and cloud-based tracking of returned items for the customer. These systems could yield valuable information for the e-tailer gained via online forms detailing the items being returned, and the exact reasons why they've proven to be unsatisfactory.
Make sure to download the eTail Fulfilment and Returns agenda to check out all of the great activities, speakers, and sessions planned for this year.