May 11, 2014, 5:58 PM

Four tips to more efficient handling of returns

With more than 60% of online shoppers making at least one online exchange or return each year, it is important that web retailers master the returns process. Here are four ways to do that.

E-retail businesses often endure high overhead costs directly related to customer returns and exchanges. Unlike brick-and-mortar stores where customers can simply bring in their unwanted products, return them and receive money back or make an exchange, online returns are very different. In fact, the return process usually goes something like this:

- Customer buys product
- Online store ships product, and may or may not have paid for shipping
- Customer doesn't want product
- Customer goes to the company website and prints a return shipping label for which the online store probably paid
- Customer ships unwanted product
- Online store is then responsible for storing the item
- Online store is responsible for crediting the customer's account or allowing an exchange to take place

An online return is undoubtedly a bit more complicated than an in-store return. And with more than 60% of online shoppers making at least one online exchange or return each year, it is important that the return experience be a good one, especially since a positive return experience tends to dictate whether or not a customer will come back in the future to make another purchase.

There is no denying that exchanges and returns take place at a higher rate during the holiday season, but it's still very important that all online businesses find ways to effectively manage their returns and reduce costs of customer returns and exchanges all year. Fortunately, there are several tips that can be followed to quickly and accurately deal with returns and exchanges without high costs.

#1) Everything needs to be labeled
When items aren't labeled, they tend to get confused with other items and put in the wrong place. An online store needs to make sure that all items are shipped with proper labeling, and when customers want to return an item, they need to be required to include all labeling with the returned product. This label should include the name of the item, the manufacturer, the price and when it was purchased.

#2: Shipping labels are free
Labels that you include within the boxes of items are not going to be free, but if you shop around, you can find a supplier who is reasonably priced. Shipping labels on the other hand, can be acquired free of charge. Make sure to take advantage of this, as shipping labels can become extremely costly very quickly. If you want more information on free shipping labels, visit the United States Postal Service web site.

#3: Use software
Technology is your best friend, especially when operating an online store. Your store needs to keep track of returns and exchanges via software. Software will make it incredibly easy to see how many returns and exchanges are in active progress, how many have been made over a specified time period, etc. You can even enter notes for each return or exchange describing whether or not the customer was happy with his/her experience. If the customer wasn't happy, you need to take appropriate steps to correct the situation. After all, happy customers are your bread and butter in being able to maintain profits.

#4: Work your returns and exchanges in batches
There is a time and place for everything, including handling your exchanges and returns. When you work them in batches, you'll likely be able to reduce the associated overhead costs as well as increase your time efficiency. For example, when working exchanges and returns individually, you may find yourself spending an hour a day working five orders, but if you devote a whole day to working them, you'll find you can increase your productivity and likely work 20 to 30 orders in any given hour. Depending on how busy your business is and how many returns and exchanges you go through, you might not even need to devote an entire day to handling them.

Accurately tracking customer returns and exchanges isn't difficult when you have a team of workers who are well trained and take their jobs seriously. With proper technology and smart thinking, all exchanges and returns can be handled effectively, and more importantly, they can be dealt with sans high costs or time commitments.

Chicago Tag & Label ( is a manufacturer of form labels, labels and tags that serves industrial, e-retail and distribution businesses.

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