Managing the Rise of Returns
With the ability to track inventory effectively throughout the reverse supply chain, retailers can eliminate the time spent manually processing returns. Returns can be processed faster and sent to the shop floor more quickly, increasing the possibility of selling items at full price while decreasing the labor required to process returns.

By Dean Frew, CTO and Senior VP of RFID Solutions at SML Group

The rise of returns has recently become a growing issue for retailers. According to NRF, 2022 saw $816 billion in sold merchandise returned to retailers over the course of the year, accounting for 16.5% of total US retail sales.

This is a notable increase from 10.6% in 2020, only two years earlier. With these figures continuing to rise, it is clear that returns are eating into a growing amount of retailer profit. In the current economic climate, businesses cannot afford to continue suffering from returns. Instead, retailers need to consider the returns process as part of the overall customer journey.

The Cost of Returns

With Mother’s Day recently celebrated across the US on May 14, in the following weeks, retailers can expect to see a range of gifts returned to their stores, from footwear and apparel to cosmetics and perfumes. This has the potential to cause a number of issues.

 Returns can be extremely costly for retailers, often due to slow and outdated internal processes. When a product is returned, it goes through several stages of the reverse supply chain before it can be resold – taking weeks or even months before heading back to the shop floor from transport, cleaning, re-packaging, and re-stocking.

Due to the seasonal nature of retail and new lines of products coming in-store, the eventual resale price continues to drop as items spend more time away from the shop floor. According to the latest research from SML, 42% of retailers sell returned items at a discounted price, and 12% of items aren’t resold at all. However, the issues are not limited to financial loss. In a competitive retail environment that is full of expectant customers who demand a seamless and convenient experience at all touchpoints, slow and outdated returns processes cause significant frustration. 

Streamlining Processes 

One predominant issue retailers find with returns is the required processing effort – with SML’s research finding that 32% of retailers claim to spend too much time manually processing them. Amidst the Mother’s Day wave, retailers can turn to technology to overcome the dilemma of the return. 

With item-level RFID, not only retail companies alleviate the financial challenge of returns, but they can make their operations more streamlined while facilitating better omnichannel offerings for customers. 

RFID technology enhances existing returns provisions by providing clear inventory and stock management insights. With a suitable item-level RFID solution, retailers can introduce stock counts of between 93% and 99% accuracy. 

With the ability to track inventory effectively throughout the reverse supply chain, retailers can eliminate the time spent manually processing returns. Returns can be processed faster and sent to the shop floor more quickly, increasing the possibility of selling items at full price while decreasing the labor required to process returns. 

An Improved Customer Experience 

While the functionality of RFID may streamline a retailer’s returns operations and allow them to resell items faster, it also plays a significant role in enabling a better customer experience.

The additional benefits created from item-level RFID – such as an improved omnichannel offering and more streamlined returns process – allow retailers to provide additional fulfillment options for their customers, such as buy online pick up in-store (BOPIS) and buy online return in-store (BORIS).

Combined with the fact that in-store associates no longer need to manually process returns and can focus more on attending to shop floor visitors, BOPIS and BORIS offerings allow retailers to further the customer experience. For example, if a customer is returning an item because it is too small or didn’t like the color, the associate – who has real-time visibility of stock levels through item-level RFID – can make recommendations based on the customer’s feedback.

In this situation, the associate can efficiently process the return, knowing that their streamlined operations will enhance the chances of still profiting from the product. However, they can now also sell another item in the very same interaction.

Overcoming the Returns Dilemma 

Returns will never cease to exist, and retailers need to accept them as an inevitable part of the overall customer journey. Instead, retailers must accept the reality of the situation and invest in technology and solutions that will streamline their returns operations and ensure a high-quality customer experience.

With item-level RFID and the inventory management capabilities that arrive with it, retailers can achieve both goals to maximize revenue from returned items and provide excellent customer service.

About the author

Dean Frew, Chief Technology Officer and Sr. VP for RFID Solutions, SML Group, and Founder of SML Intelligent Inventory Solutions (formerly Xterprise, purchased by SML in 2013). Mr. Frew is responsible for driving SML’s RFID Tags and Solutions strategy, and runs the RFID solutions division, based on his 20+ years of experience delivering RFID solutions to retailers and brand owners around the global. 

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By Alexandra Forsch, President, Awin US

Blah blah blah.

Consumers are understandably skeptical about politicians’ and businesses’ efforts towards more sustainable practices. Swedish climate activist Greta Thunberg summed up this collective feeling beautifully with the above response to the 2021 UN Climate Change Conference

And yet despite the skepticism, sustainable commerce drives more customer choices every day – from where they shop to the specific products and services they choose. According to recent research, 53% of shoppers say sustainability is a driving factor in their purchasing decisions. Furthermore, 73% of Gen Z and 68% of millennials report they are willing to pay more for sustainable goods. These figures make every savvy retail CMO take notice.

As a retailer, how do you appropriately join the sustainability movement? Many well-intentioned companies tread lightly around green topics and eco-commerce initiatives. The challenge with pursuing a sustainability agenda or talking about your ecofriendly practices is the terms can be ambiguous.

Should you be a registered Bcorp? Is it enough to offset carbon footprint by planting trees? Should you only buy local, or is it better you buy from businesses eradicating single-use plastics? These questions are complicated further by accusations of corporate ‘greenwashing.’ And sustainability is just one part of a broader discussion around what it means to be ‘ethical’ today. Environmental concerns coexist alongside other vital social issues: diversity of representation, inclusivity, accessibility.  

Transforming to a more sustainable business

For today’s consumers, conscious commercial actions speak louder than words or labels. Shoppers want brands to proactively demonstrate commitments through how they conduct business. They want to see you do

That said, consumers aren’t looking for a grand gesture. Loose change can enact big change and there are several small steps you can take for great impact. 

One way is to collaborate with manufacturers and suppliers to identify ecofriendly products on your shelves and sustainable swaps you can make. In the food and beverage sector, for example, retailers are placing additional focus on ensuring sustainable, local growing practices. And in consumables, several merchants are stocking lower-impact ‘refill’ packages that customers can reuse instead of single-use containers. While this step might seem like a daunting task, it isn’t a shift that needs to happen overnight. Look at leading retailer The Body Shop. Currently, more than 68% of its packaging can be recycled. With a goal to have all products fully-recyclable by 2025, it’s conducting a review of The Body Shop’s whole product portfolio to explore how to increase this percentage in the future – becoming more eco-conscious smartly versus quickly. 

Another way to reduce your company’s carbon footprint is across shipping operations. Many brands are collaborating with logistics partners to deliver more sustainably. These innovations include lighter and compostable materials, product packaging that doesn’t require an additional box for shipping, reversible mailer sleeves that double as return packaging and ‘green delivery days’ in which they transport multiple packages at once instead of making a series of trips to the same location. 

One final way you could improve your brand’s sustainability is by offering on-premise receptacles to collect disused items (regardless of whether they were initially sold by you) to be recycled or repurposed – especially e-waste, beverage containers and clothing. The partnership between Madewell and Cotton is one successful example of this practice, transforming donated denim into housing insulation and offering customers $20 off a new pair of jeans as a thank you. 

The new wave of partnerships

As a for-profit company, becoming a more sustainable enterprise can’t be at the expense of your bottom line. In fact, adopting more ecofriendly practices opens up avenues to connect with that 53% of consumers driven to make sustainable purchases. So how do you reach them? 

One of the best ways to engage with this target audience is via affiliate marketing partnerships. A growing number of affiliate partners (think influencers, bloggers, media houses… even cashback sites and coupon portals) specialize in sustainable and eco-conscious topics, curating recommendations of brands aligned with positive values that consumers can trust to buy from. They see the flexible, controllable nature of the performance-based affiliate marketing model affords a chance to monetize traffic with like-minded retailers while fulfilling their missions.

In these partnerships, you and your team collaborate with these trusted authorities by offering a commission for accountable customer sales and leads, creating relationships that reward sustainability partners when they drive business results for you and help fulfill both their mission and yours.

Such partnerships help shoppers feel part of the drive for a more sustainable world. They empower customers to express their values in their everyday purchases. By buying from you, they demonstrate a commitment to a more eco-conscious future. And this ethical ‘alliance’ helps drive increased purchases and shopper loyalty over shared values in how you drive future growth. 

Putting a strategy into practice

The first step in pursuing these new eco-partnerships is to acquaint yourself with the many partners anxious to collaborate on a performance basis and whose eco-objectives and equities align with your own. 

If you have an affiliate marketing team, they may already be familiar with some of these businesses. Further, your larger marketing team might have someone passionate about these initiatives who can help guide your efforts. 

If your company’s sustainability efforts focus on something other than environmental issues, there are partners also supporting other worthwhile causes. For example, you can work on a performance basis with groups that support active-duty soldiers and veterans, promote universal healthcare access, fund better education, empower individual-level charitable giving, etc. 

Whatever your goals, there are partners ready to help you take action. They align investment with your values, help your business grow and make your customers not only feel better about the initial purchase they make with you but help keep them coming back for more.

About the author

Alexandra Forsch is president of leading affiliate marketing platform Awin. As a seasoned online marketing professional with over 20 years of experience and a proven record of outperforming corporate goals, Alex has a strong background in performance marketing, media planning and buying, online marketing solutions, strategic and financial planning, team building and client relations. She started her journey with us in 2011 as Head of Account Management for and quickly progressed to lead the full North America operation, developing a high performing team and successful partner network as well as overseeing the US migration of to Affiliate Window, and later the rebrand to Awin in 2016. In 2019, Alex was appointed President of all US operations when unifying leadership of Awin and ShareASale, with goals to expand upon our strategic solutions offered to clients across both platforms in North America.

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