How a Robust Return to Vendor (RTV) Strategy Saves Money

Lack of an RTV strategy could be costing your business wasted product and lost profit.

Return-to-vendor has become a significant part of any company’s reverse logistics process, especially as the rise of e-commerce and online shopping increases the volume of total products returned to retailers. It’s critical for retailers to have an appropriate way to track and manage return to vendor processes to ensure that you’re not losing profit.

Why RTV Could be Costly for Your Business

In the absence of a strategy to track and manage RTV in your business, it could end up costing you a lot more than you think. The reasons can vary:

  • Time – every step of a reverse logistics process takes time, and the more time that products spend in transit between consumers, retailers, and vendors, the less likely you will be able to resell them for a profit. It’s critical that you can track RTV and use data to guide decisions on when it’s the best choice.
  • Fees – many RTV policies can cost you because the vendor will charge a restocking fee. In some cases they will also charge return shipping costs, which could add up if you have a significant amount of product going back to vendors.
  • Frustration for your customers – return to vendor strategies may seem like the best idea to avoid handling returns on your own, but the longer it takes, and the more costly these processes are for a consumer, the more likely they become frustrated. Most of the time they will blame you as the retailer, and choose to take their business elsewhere.

How to Build a More Robust RTV Strategy

RTV can be costly and have its drawbacks if it’s not executed well, but having the right reverse logistics software can help you manage and streamline the entire process. There are some key features your software can provide that will make RTV easier and more cost-effective.


Shipping individual items back to a vendor can be very costly, and those shipping costs will add up on your expense sheet. But software can help you consolidate products from various categories and locations together into a larger shipment that is more cost-effective. You save money on freight and shipping charges, and you don’t have to hold on to unwanted inventory.

Inspection & Grading

Marking each returned item with its condition, value, and status helps you track and manage the things that should be sent back to the vendor. Without this level of tracking you could end up sending things back to the vendor that they won’t accept, which (again) adds to your costs. Customizable grading levels and automated tracking can expedite your process.

Contract Terms

If your vendor contract specifies that only a certain percentage of goods can be returned, you can put that into your software and keep track as you get toward that goal. That helps prevent wasted shipments that the vendor won’t accept after you reach your contract terms.

Reducing Return to Sender

Without software to help you track RTVs, you could end up sending things that the vendor won’t take back, resulting in “return to sender” goods that are back in your inventory.

Find out how ReverseLogix software can help you manage your entire RTV strategy and avoid losing money.