Additional considerations for controlling product return cost for the Retailer:

• Improving inventory planning and forecasting systems on the front end, especially for seasonality, can greatly reduce the potential returns liability.

• Consider moving excess/damaged product to an outsourced partner selling in the heavily discounted space. Many of these companies are very good at online re-marketing. Remember, this should be financially advantaged over internal programs.

• Push back on the manufacturer for improvements in product instructions, packaging and design. Retailers are in a unique position to collect product return intelligence and feed it back to the OEM. This feedback is a critical requirement for the OEM to improve the product.

• Keep the returns process centrally controlled. Disseminating control to localities generally adds cost, time and process inconsistencies.

• Consider policies that do not encourage consumers to return.

Additional considerations for controlling product return cost for the On-Line Retailer:

• Stop free shipping. Free shipping can encourage returns that would otherwise not be made by reducing consumer financial liability.

• Accuracy of product presentation and specification can have a major influence on the volume of returns. Investments here can make significant differences in return rates. Remember, that at least 70% of the customer base makes decisions through visual information.

The Other Half of the Reverse Side
Channel returns are only part of the reverse logistics story! They are getting a lot of headlines today because of their enormous volume, but let us not forget the other half of the reverse side; "warranty, post-warranty and end of life products."

How are extended warranties (that used to be called service contracts) impacting TPMs? Where is post-warranty service headed? Where do contract manufacturers who are also TPMs fit in? What does the future hold for the Repair Service Provider in reverse logistics? What are the repair and logistics dynamics today as manufacturers outsource more and more and more…?