Are Reverse Logistics Wasting Your Company’s Money?

The high cost of poor reverse logistics management

Getting a hold on reverse logistics – the post-sale portion of your business – can help you reduce wasted revenues.

If you don’t think your reverse supply chain is costing you money, you might be surprised to learn about the many different types of costs that are potentially lurking within.

If you implement strategies to manage your reverse business effectively, you can determine for certain what your costs are and identify ways to reduce this drain on your bottom line. You might even find ways to strengthen your brand and enhance the customer experience, helping you improve future sales.

Labor Costs Associated with the Reverse Supply Chain

You may recognize the costs associated with performing warranty repairs but are you truly aware of all the work hours that go along with the reverse supply chain?

If you haven’t implemented a clear returns policy and made it highly visible to your customers, your customer service team is likely fielding tons of calls about this issue – and absorbing unnecessary costs.

Have you developed and implemented clear standards for handling and processing warranty returns and repairs, or is the warranty team evaluating each return subjectively? The evaluation process itself takes time and, as a result, you could be performing repairs or issuing replacements when you shouldn’t.

These costs can add up quickly – and they aren’t the only labor costs that are being squandered in your reverse supply chain.

Shipping-Related Reverse Logistics Costs

You may recognize the shipping costs you incur when a customer returns a product or needs warranty service. But do you realize how many other costs are associated with this aspect of the reverse supply chain?

If you don’t have a standardized, automated method of return shipping or issuing RAs, you’re paying someone to do that for every return (labor costs again). If you aren’t tracking returns, you risk incurring replacement costs.

Are you negotiating rates and terms with your carrier? How are you handling damaged items? Even if you don’t have a substantial volume of activity in the reverse supply chain, these costs can quickly add up.

If you aren’t tracking returns, the chances are good that your customers can’t see where their issue is in the process either. And that means they will email or call to get the status of their repair, replacement or refund – and that means you incur even more labor costs.

Loss of Future Sales & Brand Identity

If you aren’t managing your reverse logistics effectively, you might be losing repeat business and referrals. You could also be damaging your brand.

Customers demand transparent, responsive service today, in part because they know that the technology exists to make that possible for most companies. When they don’t get it, they’re likely to take their business elsewhere (and tell family and friends to do the same). Worse, they won’t hesitate to post bad reviews online.

The better you can make the customer experience, the more likely you are to retain your customers – and that means saving money on marketing and customer acquisition.

ReverseLogix has a way for you to get your reverse supply chain under control. Our revolutionary reverse logistics management platform is a simple and cost-effective way to manage and track your returns. You’ll watch inefficiencies disappear and increase your bottom line. Our SaaS reverse management software integrates seamlessly with your existing enterprise applications, helping you transform your reverse business.

Let’s talk today about how ReverseLogix can help you put reverse logistics to work for your business.