3 Ways to Leverage Data & Analytics for more Sustainable Returns

Point of View, Sustainability
Two people collaborating with a pen and tablet.

Consumers and companies are increasingly conscious of how their purchasing habits impact the planet. But product returns also have a huge impact, and both B2C and B2B companies are taking a closer look at how reverse supply chain data analytics can help move the needle toward achieving sustainability goals.

The reverse supply chain poses questions that are essential for addressing sustainability efforts holistically: How often are products returned? How are those returns handled, repaired or disposed? Could some returns be avoided in the first place?

A returns management system (RMS) is the crystal ball of answers to these questions. It’s an end-to-end supply chain technology that facilitates, manages and reports on the entire returns process – whether you’re in the B2C, B2B, or a hybrid space. It integrates with all other major supply chain systems, giving you one central location for returns data and insights.

It’s all in the data

Although returns data is essential for comprehensively addressing sustainability goals, few companies can access that type of data. For example, in a ReverseLogix survey, more than half of respondents said their ability to identify reasons for higher-than-expected returns rates was “poor to average.”

RMS data and analytics open up entire entirely new areas of operational visibility, giving you a clearer understanding of returns processes and how they impact sustainability measures. Whether you serve consumers or corporations, a product return is not an isolated transaction. It’s a rich source of insight into your processes and customers, and an opportunity to engage with them.

#1 – Better visibility to avoid returns

When it comes to the environment, the best product returns are those that never happen in the first place. These “controllable returns” can be reduced with the right strategies that target the root cause of returns.  

An RMS gathers data so you can understand and act on the “why” behind returns. Get detailed metrics on every screen (not just reports and dashboards) to quickly identify trends or issues faster – and adapt accordingly.

For example:

Are customers reporting that a product is low quality? Address this with your product supplier to ensure they haven’t switched materials or processes. This is especially important in the B2B electronics or manufacturing space, where precision is paramount.

Are customers reporting sizing issues? Perhaps items on your website or catalog are portrayed inaccurately. In this case, a brand may consider virtual dressing rooms or better product descriptions to help customers find the right fit.

#2 – Repair and refurbishment rates

Optimizing the rules and workflows around product repairs and refurbishments support more sustainable returns operations while minimizing costs. It’s a huge opportunity for B2B brands to truly understand the cost and time associated with returns, and to create programs that handle the returns in the best way for the company and the planet.

An RMS reveals data on the costs of receiving, handling, repairing, replacing and shipping an item. Use this information, in combination with your sustainability goals, to set priorities and rules around repairs and refurbishing.

You can also take into account warranty management, parts management, and leverage the RMS’ ability to integrate directly with any testing suite for products that require testing and wiping.

Built-in RMS automation tools track parts consumed and labor expended in the same RMS platform from which you’re managing repairs, so you can easily see the big-picture of your repairs operation and ensure consistency throughout it.

#3 – Re-commerce and re-stock opportunities

Although a huge number of returns are landfilled, more B2B and B2C companies are considering reselling and restocking returns to reduce their environmental footprint.

RMS data informs better decision-making around disposition rules; take into account customer  demand, seasonality, sustainability goals, processing costs and sell-through rates.

  • Consider recovery costs and decide how best to connect returned inventory to the right channels, including third-party marketplace sites.
  • Minimize transportation costs and mileage by tracking the impact of consolidating products and vendors shipments
  • Process returns faster and set rules for restock based on geography or seasonality, so you can get the most out of returns
  • Minimize waste from seasonal or perishable items that must be sold in a specific timeframe

Data analytics for sustainable returns

It can be difficult to match your efforts with sustainability goals. When it comes to product returns, an RMS delivers concrete data and analysis for setting the best strategies and making the right decisions for your customers and corporate goals.