Reverse Logistics: Is this an opportunity for geolocation?
The right of withdrawal
In the field of trade and commerce, the consumer has always been protected by the right of withdrawal with regards to their purchases. This right allows the consumer to return a product or terminate a contract (for an offer of service) within a period which is set by law. The development of e-commerce and online shopping in France and elsewhere, both in terms of value and volume, has led to very serious logistical challenges. In 2017, growth was estimated at 14.3% for a total of 37 million online shoppers. Rapid delivery to the home of virtually anything has become key to the customer experience, and this where the world’s leading retailers and traders of the future are emerging and going head to head.
Reverse Logistics: Product Returns
But when it comes to customer experience, there’s another side of the mountain which is even higher: returning products that the customer doesn’t want. This doesn’t include products which are faulty or technically non-compliant, but simply occasions when the consumer changes their mind or only wants to keep one specific colour of a shirt that they ordered in all available styles. The consumer has the right to do so, and doesn’t hold back, on the contrary. Remember that nearly two-thirds of consumers will only buy online after reviewing the conditions of withdrawal.
What French Returns Law says
The consumer must return it in its original packaging, indicating why they wish to return it on the delivery note or invoice. They can request:
- a new delivery adhering to the order;
- the repair of the faulty item;
- the exchange of the product for another similar one or the cancellation of the order (with a refund of the amount paid, possibly including a compensation claim should any harm occur). […]
Reverse Logistics: A Marketing Challenge
The number of returns is therefore increasing considerably! Returns offered free of charge and without any real conditions have become a marketing challenge and are adding to the logistical complexity for retailers and traders. So, what are the constraints facing the reverse journey if the flows leaving the warehouses and ending up at customers’ doors or preferred delivery locations require tracking and optimisation that provide geolocation linked to real-time data processing?
Reverse Logistics: What are the constraints?
Let’s move away from the treatment of waste (carton packaging, for example) which is sometimes included in reverse logistics and let’s instead list the points to be addressed in this flow of objects returning to their producer, regardless of whether they go via the distributor or not.
1 – The quality of returned products varies: they can be new and in a perfect condition, or damaged by an original fault or through delivery. A difficulty in processing the return already emerges if the product cannot be traced from one end of the supply chain to the other (and vice versa).
2 – The price also varies depending on the conditions under which the purchase was completed on the website. How can you know?
3 – The financial management of the return can also lead to conflict or complicated decisions: does the customer need to be refunded and sent another product while attempting to recycle the returned object? Trying to identify the distribution costs incurred through each return is complex and confusing.
4 – In most cases, the negotiation between parties and the visibility of processes remain obscure and ambiguous. Who is responsible and at what level? The consumer isn’t bothered about these kinds of things and they certainly won’t explain why they decided to return an order (they did this when they returned the product in store – this also functioned as a natural check which no longer exists).
Reverse Logistics: Towards Optimizing Treatment
Successful reverse logistics require shorter journeys between the person who sends the return and the person who processes it, as well as less time spent processing the decision (to recycle it, for example). It is reasonable to assume that the “information contained” within the object and its return packaging could provide valuable data for online retailers and traders, and that the person providing, transporting and analysing it could be a key partner.
see also this article: Free online : who foots the bille ?