Warehouse Returns, and Cancellation Management – A Complete Guide

April 27, 2021

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The popularity and demand for online shopping have grown by leaps and bounds, mostly in the last few decades. An unmatched variety, the flexibility to compare products, and prices, as well as unbeatable prices, discounts, and offers, are some of the key aspects that are the key contributing factors for this. And, the evolving customer demands, the changing buying psyche also plays pivotal roles behind this paradigm shift.

Customers relish the order placements within a few clicks from the comfort of their couches as well as the no-questions-asked returns, and cancellation policies offered by most of the top-notch retailers. While this is definitely a winning proposition for the customers, it is rather a nightmare for the retailers, and eCommerce brands to navigate. In this blog, we have jotted down the important aspects retailers should know about managing warehouse returns, and cancellations.

Before delving deeper, let’s understand why product cancellations or returns occur. Here are some of the key reasons.

Wrong Delivery – Have you ever encountered a situation where you get an altogether different product delivered at your doorstep? How frustrating can that be? Obviously, you would either want a return or cancellation and payment refund. Wrong product delivery is one of the most prominent reasons retailers face product cancellation or return requests.

Product Variation Delivery – Ordering a product with set specs, and key attributes is a conscious purchase decision. However, getting a product with differing attributes, be it the colour or technical aspects, can lead you to return the product or even cancel the entire purchase.

Damaged Product Delivery – This is of utmost concern specifically for products that are susceptible to breakage. Of course, a broken or damaged product won’t be of any use to you, and seeking a return is the next best logical course. While the retailer brands owe you this, it might be an overhead cost for them as they have incurred a loss due to the product damage, and they have to pay your money back also.

Delivery Timeline/Changed Buying Intent – Many times, customers end up not needing a product after they get it. It is most applicable in the case of impulsive buying. Whatever may be the reason, the retailer and the warehouse team have to endure the process of order cancellation or returns.

While returns and cancellations are inevitable for all retailers and eCommerce brands, they can leverage a robust, clear returns, and cancellation policy to safeguard their business intent.

Retailer brands must make an effort to keep their eCommerce return policies clear to understand and visible on their website for the viewers. They should dedicate a section in their websites for FAQs about how consumers can expect the return process to go, get insights about the refund structure, etc. This will help them avoid unwarranted hassles and will also enhance the customer’s trust in them. Such levels of transparency will enhance their sales prospects.

Retailers must ensure the return and cancellation process remains a win-win situation for them and their customers. Here are a few clauses they must take care of while formulating policies.

  • Set a fixed timeline for creating return requests
  • Mention the eligibility criteria of an item for returns or cancellations
  • Additional charges on returns, if any, also should be spelled out in the policy documents

Having stringent returns, and policies is a great start. However, as an eCommerce business, you still have to manage the returns and cancellations. And, you need to be prepared for this also.

There are a few key areas they need to think about and make provision for.

  • Warehouse space is a critical factor. Retailers must keep an extra space for storing the returned or canceled products safely; otherwise, they may run the risk of further damage.
  • Sorting of the returned products based on category, size, fragility, etc. is also a daunting task for the retailers. They may have to dedicate an extra workforce for this task.
  • Updating records of returned or canceled products in real-time is pivotal to ensure complete accountability. This is essential for warehouse replenishment needs and to avoid understocking, and overstocking concerns.

And, having a policy in place, and making necessary provisions are not enough. Retailers have to introspect the key causes that have led to product cancellations or returns. This is highly essential if they are eyeing for business scalability, success, and growth.

Here are a few aspects retailers must revisit.

Product Performance

Retailers must flag the most returned items, analyze customer feedback as well as watch out for the customer purchase behaviour. Besides, retailers can work around to enhance the product depictions as well as the response time.

Cause of Cancellation 

Cancellations are not always initiated by the buyer; sometimes the seller also has to do it due to a wide range of reasons. Product out of stock, quality issues, pricing errors, failure to deliver to a specific location are some of the key reasons a seller has to initiate the cancellation process. While taking care of these aspects by rehashing strategies is a must for retailers, they also should watch out for the reasons customers initiate order cancellations.

When it comes to product returns, the end-user has the flexibility to either return it to an alternate location or directly to the warehouse. For each of these options, the retailer has to make provisions.

With Vinculum’s robust order management system, retailers stand a better chance to turn the tables and transform the challenge of returns, and cancellations into opportunities. Interested to explore more? Connect with the experts at Vinculum today!

Want to grow your business?

Your staircase to
growth is here!

Quick tricks for growth:

  • Reconciliation of overcharges
  • Single inventory dashboard
  • Reduced order processing time
  • Standard and accurate data

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