Protective packaging: A key component of your reverse logistics strategy
E-commerce continues to be a vital channel to market for many companies, especially retailers. As a result, reverse logistics is rising to the top of supply chain priorities. Why? Returns go hand-in-hand with online sales – particularly because consumers are being enticed to return items for no additional charge.
That means customers are more likely to overorder as they know they wield the power to return the neon yellow shirt that looked better on-screen… then on them. According to PARCEL magazine, 76% of consumers agreed that free returns are an important consideration when shopping online.
Businesses are now feeling the implications of their lenient return programs, which is creating a log jam of returned products in company facilities. In fact, the average online return rate was 20.8% in 2021 – 4.2% above the rate of all transaction types, according to the National Retail Federation (NRF).
For years, companies have primarily focused their time and investments on getting products out the door – not back in. However, as returns grow, they are being forced to resolve this process – and do so in a more cost-effective way. Forward logistics warehouses are being converted to include processing areas for reverse operations, and many e-tailers are additionally supplementing their supply chains with returns-centric third-party logistics (3PL) companies.
In both instances, once the decision is made to refurbish an item, and sell it back to consumers, or a warrantied product is returned to its owner, protective packaging becomes imperative.
Three areas where protective packaging is key to the reverse logistics process
Inventory/Inbound: are you breaking down pallets of returns, evaluating them for resale, and transferring those items to stock? Automated bagging equipment allows packers to get those products quickly and efficiently into dust covers, seal them and print barcoding on-pack for easy tracking in inventory. Poly bags expertly protect items from dirt, dust, humidity, and any other adverse conditions that may arise while being stored in a warehouse environment.
Recommerce: any returns that have been officially deemed re-sellable often end up back on retail sites or are sold to liquidation companies for resale. In either scenario, once those items are re-purchased, they may be shipped direct to consumer. Whether its apparel or electronics, mailing solutions and in-the-box packaging are key during the repackaging process. They are engineered to ensure products are contained, and/or cushioned during shipping to minimize the risk of damages.
Warrantied Items: more and more products are being warrantied these days – especially when it comes to electronics. Once a consumer ships that warrantied item back to the appropriate facility and the item is fixed or replaced, it needs to be returned to its rightful owner. This initiates the outbound fulfillment/shipping process, where packaging enters the workflow. Air pillows or paper void fill, for example, are designed to reduce the excess space in the box, ultimately securing usually smaller, sortables during transit.