With e-commerce growing exponentially, the number of items being returned to retailers is also on the rise. Not only in number, but also in proportion as more businesses offer free return schemes. It is estimated that returns from online purchases cost UK retailers £20bn a year, with this figure rising as the proportion of returns increases. The problem is, the easier we make online buying for customers, the more 'try before you buy' mentality creeps in. Where consumers buy several items with the intention of only keeping one.
If you purely sell wholesale to other businesses, you will be once removed from this issue as wholesale relationships generally do not cater for returns. However, this issue could well be suppressing your sales because if your stockists are getting lots of returns:
- They won't need to buy as much new stock from you.
- It may put them off buying new stock from you.
- They may not be able to afford to buy new stock from you.
So, is there anything you as the supplier can do to help your retailers minimize the impact of returns? I think so, and all you really have to do is have a conversation.
Get regular feedback from your stockists about returns. Find out if there are any products that seem to have a higher than average return rate. Does the retailer know the reasons for the returns? You may discover there is a sizing or quality issue. Often consumers are comparing against other similar products so, although it might not be easy to hear, you may find out you're losing out to a particular competitor. Maybe the retail returns rate ties in with your sales data, and this product line should be discontinued? Perhaps it varies wildly by stockist, and you can make suggestions as to what might work better for them? Maybe it is all just totally random and makes no difference to you.
The fact is if you never ask, you will be missing out on potentially crucial information. If you engage in these conversations you will uncover details about your products that they would otherwise never share with you, and if you don't sell to the end-user yourself this is especially invaluable. And if you feel the information isn't useful to you, at the very least your stockists will think you are great for taking an interest in their business.