Are returns the biggest barrier to online profitability?

When working with retailers to reduce returns and sustain profit growth, we have two initial questions:-

 

Question 1. How much are returns really costing?

So not just expressed as a % of orders, but also in unnecessary fulfilment costs, wasted warehousing capacity, reduced stock availability, inefficient use of working capital, and so on.

Question 2. Are they being actively managed and controlled, or just being accepted as an inevitable cost of selling on-line?

Concentrating effort on reducing returns at the same time as growing sales can have a huge impact on profitability.

 

Example – Retailer A

We discovered that this retailer was spending £25 million a year shipping stock to and from returners to achieve zero sales.


Example – Retailer B

We calculated that reducing returns by 11% would have a greater impact on profit for this retailer than increasing sales by 20%.

It’s a complex area, with massive volumes of data to analyse.   Establishing who the genuinely unprofitable customers are, and doing something about them, without impacting the profitable ones, is key.

 

At Clear Returns we offer detailed returns data analysis and insights through to AI modelling to create direct data feeds for dynamic, customer level intervention.

Combining a market-wide view, award-winning returns insights software and a commercial focus – because it’s not really a sale until the customer ‘keeps’ it – Clear Returns reduce returns without impacting top-line growth. Clear Returns gives retailers an informed, holistic view of returns with a detailed understanding of who is returning which products, and why, and provides actionable insights that accelerates gross sales, reduce operational costs, improve stock availability and increase retained revenue.

 

We can enable significant reductions in returns and profit growth.