What happens when a product doesn’t meet the expectations of an end user? Usually, that product is returned to the store or posted back 
to the online retailer – and that’s all as far as the customer is concerned. Most customers, as long as they feel that they have been adequately compensated either with a refund or replacement, will be happy.
Returns and the impact on your business
But what does the simple act of a return mean for you as a start up business? A good returns policy tends to equal a better relationship between you and your customers by providing them with what they want. In terms of unwanted goods, this falls under reverse logistics.
Put simply, reverse logistics is the process whereby goods move backwards through the supply chain to be dealt with by the manufacturer. This can happen for a number of reasons, including a fault with the product, too much stock or even merchandise that has gone ‘out-of-date’, for example, monthly magazines or computers.
Usually, one of several things happens to goods that go through this process; they can be re-packaged and sold as new, sold cheaper elsewhere, like to an outlet store, recycled or simply disposed of.
One of the problems facing start up businesses when dealing with their own returns is the structure of their plan. Whether an online or a bricks-and-mortar store, if the number of returns is too large to handle or the price of the items in question are low, dealing with the odd faulty product here and there isn’t economically viable.
Setting up collection points where customers can drop off the returns is time consuming and asking customers to pay postage costs for their own returns can also aggravate, especially if they have to go out of their way to drop the item at their nearest post office.
But there are some solutions, such as warehousing and distribution companies who deal with reverse logistics as well as forward supply and delivery. The bigger companies have procedures in place to deal with every aspect of the process, allowing for several different return options to best suit you and your customers.