Reverse Logistics Processes Key to Success

Optimise your reverse logistics processes with Cloud WMS solutions.

Reverse Logistics processes is how your business handles the return of products from a consumer or a retailer to you through the use of the supply chain. Reverse Logistics also encompasses recycling of packaging and containers, reconditioning or refurbishing of products and disposition of obsolete goods.

Have you ever wondered what your local shop does with the items that you take back as damaged or unusable?  Most industries today, in the competitive world we live in, have liberal returns policies to attract and keep customers, that can quickly tax distribution networks when large quantities of items go through the reverse logistics process.Reverse logistics is one of the least focused areas for many companies.

However, the ability to recuperate assets and revenue in the supply chain is causing a refocus in this area. There is a lack of understanding of what is being returned and why.

Customers would be unlikely to shop with a retailer again if they had a bad returns experience.

Returns can be a headache if not managed properly. As a critical product life cycle phase, the need to support reverse logistics processes is not only important, it can be an opportunity to capture additional revenues that would have been lost without the proper supportive systems. Whether your company manages the distribution of its own products or outsources logistical services to a 3PL, the ability to provide return services is fully dependent upon the capabilities of your WMS.

WMS cloud software provides the ability to process all types of returns with high speed modules—some even with specialised functions for goods such as clothing, publishing, spirits, and more.

Top Key Benefits of WMS:

  • Damaged Goods can be quarantined and dealt with promptly for repackaging or disposal.
  • Essential for ECommerce businesses who need to manage high returns volumes.
  • Quickly identify re-usable stock so that it can be relocated for order picking.
  • Complete Traceability allows you to track and monitor the levels and types of returns.
  • Integrates with ERP systems to ensure credits, replacements are done promptly to maintain customer satisfaction levels.

On a daily basis, in warehouses across the country there are thousands of packages coming in for returns. Many warehouses are struggling to cope with the high volume of returns due to ageing software and lacking in the correct processes to cope with both despatch and returns.

The returns area of a warehouse is commonly full of a mix of open cartons from many different SKU’s that need to be identified and sorted according to disposition.  Through this sorting process, credits must also be issued and return-to-vendor tracking created.  The combination of process complexity and low priority of reverse logistics processes typically means little attention is given to improving these returns processes. As a result, warehouse managers tend to treat it as a necessary evil.

Returns are fundamentally complex because of how they impact physical inventory, electronic inventory and accounting systems.

All items must be identified, assigned to a customer or account, assigned a disposition and then physically sorted for processing.  Since some of the product might be discarded or kept back for vendor chargeback’s, not all merchandise enters electronic inventory; some merchandise must be repacked and accounted for manually versus electronically.

Finally, credits are generally issued at a later time and often for only some part of a return, including discarded or un-saleable goods.  This process is difficult to automate with a generic ERP package and very challenging with a simple paper process. Specialised returns systems part of a Warehouse Management System (WMS) can support effective automation with appropriate setup.

Improvements in Reverse Logistics processes in your WMS will not only result in significant cost savings such as labour cost reductions but additionally, improvements can result in much faster processing turnaround times, which can then lead to faster and higher cash generation on the returned assets as well improved customer satisfaction.

Time is money – Daily Telegraph article (‘Clear Returns’) points out:

“By mid-December, £600m worth of stock bought between Black Friday and December will be tied up in the returns system, preventing retailers from selling the items during the crucial sales season.”

While it’s important that retailers can handle returns in a way that satisfies the customer and minimises costs, it’s equally important to get stock back into circulation again as quickly as possible. Many returns will be ready to go straight back on to the shelf, which means improved availability for customers wanting these items. In-store re-labelling and scanning back into the stock file keeps the wider stock picture up to date and reduces the risk of overstocking. The WMS allows for the items to be easily inducted and assigned conditions that will enable system-directed moves to process the inventory efficiently.

Many warehouses can’t cope with the high volumes of returns because they are using ageing software to keep track of millions of parcels. Does your WMS have the functionality you need to improve your Reverse Logistics processing? Is it time to re-think your Receiving and Reverse Logistics processes and systems?

Returns are here to stay, inevitable and they are on the increase

Retailers need to deliver customer convenience in the returns process.  Returns processing modules should be tightly integrated into your WMS.  The integration allows for real-time inventory control, immediate inventory allocation, instant picking from the returns area, and cross-docking to a shipping dock.

About us:

Speak to one of our team to understand how Clarus’ WMS system can cost effectively support best practice warehouse management processes, better customer service and highly efficient working for a range of warehouse operations with pay per month options and no IT infrastructure needed.

Our platform can scale from a one user, small depot system to a 100’s of user distribution centre operation. The ClarusWMS platform will cost effectively scale with your business based on demand.

ClarusWMS is a UK based supplier of warehouse management solutions with a wealth of industry experience in third party logistics, wholesale / retail distribution, online fulfillment and manufacturing warehousing.

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