Cathy Roberson [00:00:02]:
How much does returns cost you? They can't tell you that. They don't know. And that's also been one of the big problems of returns. Trying to manage returns is that returns can happen at any part of that retailer's business. It's very siloed. So one group within a retailer or brand may be handling their own returns, another group is managing their own returns, but they're not talking to each other. So they don't know how much volume they actually have or how much it's costing them. So that's the biggest problem that they have to conquer first.
Glenn Gooding [00:00:45]:
Welcome to Parcel Perspectives, the podcast dedicated to small parcel shippers. I'm Glenn Gooding and each episode we dive into insights, best practices and strategies to help you navigate this complex, costly market. Join me as we explore ways to strengthen your long term partnerships with your chosen carriers and stay competitively aligned. Retreat for you. Today I have a guest. I think she has a lot to share with us. I think it's very timely and very appropriate given the fast approaching holiday season that we find ourselves in. So with that, I'd love to introduce everyone to Cathy Roberson.
Glenn Gooding [00:01:29]:
She's the founder of Logistics Trends and Insights. And I kind of want to set the tone for the topic and then kind of give Cathy an opportunity to introduce herself to everyone, talk about herself for a second and then we'll kind of dive into the conversation. I could tell you that generally speaking here, what we're talking about is peak season, holiday season, huge surge in outbound volume. With that, in the e commerce market comes a huge surge in returns. And so today we really want to dive into reverse logistics. I don't think it's ever been more critical than it is now with where we're at in the life cycle of E commerce. So Cathy, who is founder again of Logistics Transit Insights, going to share some of her experience and her expertise on how businesses can efficiently manage those during the very busiest time of the year. And we're going to dive into strategies and tactics that help reduce operational costs, minimize environmental impact, possibly sustainability initiatives, and most importantly, keep customers satisfied, all while trying to get all this stuff done during peak season.
Glenn Gooding [00:02:38]:
So, Cathy, welcome.
Cathy Roberson [00:02:41]:
Thank you. I appreciate the invitation.
Glenn Gooding [00:02:44]:
Great to have you on. You want to tell everybody a little bit about yourself and who this expert is? What's going on?
Cathy Roberson [00:02:52]:
I'm not sure. I think I'm more of a student than I am an expert. I've been in the supply chain world for over 20 years, starting my career with UPS on the supply chain Solutions side. So I did a lot of the research, analysis, due diligence work on the numerous acquisitions that now makes up UPS supply chain Solutions. Did a lot in the freight forwarding contract logistics space until after I left UPS after about 10, 11 years. And I found myself in the parcel market working with some consulting firms. So I learned about the parcel market outside of ups.
Glenn Gooding [00:03:37]:
That's ironic, isn't it?
Cathy Roberson [00:03:39]:
Yeah, seriously. And I still do a lot in the parcel market. I tend to write a lot of content, white papers, do analysis work for consulting firms and other businesses, do a lot of the research. My background going back many, many years is as a librarian. So I'm one of those few that have that master's in library science. Yay. Yeah, I still do, like I said, a lot of work in the parcel side of the business, but I also do a lot in the reverse logistics space, working with the Reverse Logistics Association. So I did a lot of their research and analysis.
Glenn Gooding [00:04:20]:
That's fantastic. Glad to hear it. So I think what we're going to stay away from today is the Dewey Decimal System, if you don't mind.
Cathy Roberson [00:04:26]:
Yes, please. I think I've forgotten most of that.
Glenn Gooding [00:04:29]:
Yeah, me too. I think we've both dated ourselves terribly by even mentioning that terminology. But reverse logistics. Why don't we start at the top, if you don't mind, Cathy, for anyone listening that may not have an intimate knowledge of what the term reverse logistics means. What does that mean in your world, Cathy? What is reverse logistics?
Cathy Roberson [00:04:49]:
Okay, so we're all familiar with what I just describe as the front end of the supply chain all the way down to, you know, from ordering to delivery, Ocean Air Freight, all the way down to that last mile delivery. Last mile delivery. That's kind of a weird misnomer in a lot of ways because there's that whole back end, the reverse side, which is the returns, the repairs, the recycling warranties and such as that. So it's all that back end of managing all of that.
Glenn Gooding [00:05:23]:
Got it. Yeah, there's a lot going on there. Right. And it's different based off of the product or the industry vertical or who your clientele are, isn't it?
Cathy Roberson [00:05:33]:
Oh, gosh, yeah. I mean, there's a lot of it going on in the high tech space. You know, phones, laptops, a lot of repair work, refurbishment. You know, you may have bought a refurbished laptop off of ebay, for example. Well, that's an example of reverse logistics. Apparel makes up a lot of the returns. And you see a lot of company startups, online, businesses reselling apparel, clothing and such. Goodwill.
Cathy Roberson [00:06:05]:
Goodwill is a great example of reselling items that have been donated to them. That's another example. So there's a lot out there. It's interesting. A lot of the interest in reverse logistics has really come on recently, particularly with the pandemic with the online E commerce, because E commerce has really emphasized the issues facing returns in particular.
Glenn Gooding [00:06:32]:
Yeah, E commerce, my goodness, it has grown and grown and grown. I think when you and I were talking the other day, I think you and I were, I think, in agreeance, but we don't have any empirical data to back it up. But you and I are beginning to scratch our heads at this whole Black Friday thing now. And, you know, is peak season, follow the same historical trends that it always did in years past. And I. I intuit that. I think it's a little different now. I think the online buyer is different.
Glenn Gooding [00:07:02]:
I think the E Commerce Channel has matured to a point that it's adopted by everyone now. I think Covid forced that adoption around demographics that were probably resistant to it. Folks like our parents, right?
Cathy Roberson [00:07:14]:
Yeah, exactly. Exactly.
Glenn Gooding [00:07:17]:
So I think everybody's really comfortable with that. And so I just don't see the big story of a reporter running out to go see the line lined up outside of a Nordstrom, you know, at midnight on Thanksgiving for a Black Friday sale. I just don't see that happening anymore.
Cathy Roberson [00:07:33]:
And that's such a shame because that was so fun.
Glenn Gooding [00:07:36]:
It was, it was. But I think, I think overall, the trend we're in general seeing is brick and mortar is constricting. Right. It's retracting. Retailers are changing strategy. But you. You have a different opinion on that, Cathy?
Cathy Roberson [00:07:49]:
Yeah.
Glenn Gooding [00:07:49]:
Lay it on me.
Cathy Roberson [00:07:51]:
So I think, if anything, when E commerce really came on strong, even before the pandemic, you know, we read all these stories about the death of brick and mortar. You know, we don't need brick and mortar. And yet even during the pandemic, with the closure of stores, we saw E commerce going in. But brick and mortar is so important to the whole network, even for E commerce. You need a physical store to be able to drop off stuff. For an example.
Glenn Gooding [00:08:25]:
I agree.
Cathy Roberson [00:08:26]:
Or to pick up. It's part of that network. You see that Walmart in particular is building out. I think that's really the future of what they're working on and what Target is doing as well.
Glenn Gooding [00:08:39]:
Point taken. Let me qualify my remarks maybe a little better. I would say Omnichannel is growing. So the shift I see in brick and mortar when I Get drug along on a shopping excursion with my wife. Right. We go in. Invariably they might have a variety of styles available, but only one size or a couple sizes available on the rack. And once my wife finds what she likes, she brings it up and they said, we'll be happy to ship it to your house for you.
Glenn Gooding [00:09:09]:
Right. So it becomes another channel for Essence E Commerce, but allows the flexibility of being able to pick up the garment, look at it, you know, hold it up against you, things like that. So I think that's where I see brick and mortar going. You know, I think there's also some major retailers that are probably redesigning themselves. Like, for example, Nordstrom is really taking down a lot of their flagship stores now and they're really leaning into the E Commerce channel. Right. So there's much.
Cathy Roberson [00:09:41]:
Definitely.
Glenn Gooding [00:09:41]:
So it's interesting. It is interesting. There's a lot of flex there. I think the thing we can strongly agree upon is there's a lot more volume moving in the E Commerce channel in the final mile, the small parcel delivery.
Cathy Roberson [00:09:53]:
Yeah, totally agree.
Glenn Gooding [00:09:55]:
So if we were to kind of narrow the focus just a little bit on this around that period, E commerce companies, I think, are clamoring for new clients all the time and I think they spend a lot, lot of money to acquire new customers. I can't think of a better time for an E commerce company to acquire a new customer than in the fourth quarter when all of us invariably are shopping for something for someone. Right. And so I think there's definitely more first time buying experiences in the fourth quarter than any other time of the year. And I think that's a time when it's critical to take care of the customer from what we're talking about, the outbound piece. But the reverse logistics is a key, key part to this. Right, Cathy? So, yes, I'm going to use my wife as an example. You know, if she sees something online that she likes and she's not entirely positive on the sizing, she may order three of it.
Glenn Gooding [00:10:55]:
One smaller one, the one she thinks, and one larger. So invariably, two thirds of that shipment after it gets to our house and she tries them on is going to be going back. And so I think it's critical to think about what does that experience look like and how do you do that? What are you, what are your thoughts on that?
Cathy Roberson [00:11:12]:
You're exactly right. That's been a big problem for quite a while. It's called bracketing. When a customer knowingly buys either different sizes or different colors of the same item, knowing that they're going to return at least one, if not all of them. And it's difficult to break that habit. But there are a number of ways for an e commerce provider to do that. One is to make sure that that website is optimized to the fullest, meaning that the colors are as true as possible. So this is a gray shirt, you know, it is not blue, it is not brown, it is gray.
Cathy Roberson [00:11:56]:
And that there is an accurate sizing chart available to use when ordering. Also customer comments and not those paid ones that you see on various platforms. But true, honest to God, customer feedback that's posted there like, yeah, this T shirt is smaller fitting, so I recommend you get a larger size or what have you. So things like that.
Glenn Gooding [00:12:23]:
Yeah, you're bringing up some interesting points. I like, I like where your head's at because you're kind of thinking upstream a bit. The way I see you leaning in right now is are there proactive things that a brand can do to mitigate their exposure to the need for remove logistics? Right.
Cathy Roberson [00:12:38]:
That's it. You can never do away. I mean, you cannot solve the returns policy 100%, but you can mitigate it by making sure that you've got a good website, one that is fully optimized. Also, your returns policy in the past, and there's still a number of retailers that do this, they offer free returns. Well, that's like opening up a Pandora's box there, saying, please continue with your bracketing practices. But in all honesty, those free returns, just like free shipping, there's no such thing for either one. Someone's paying for that return and it's the retailer. And they're already struggling to improve their margins.
Cathy Roberson [00:13:25]:
They operate on thin margins a lot of times. So a lot of them are doing away with. They're rethinking the free return policy by either charging a small amount, like a dollar or two dollars for a return, or they may charge for the shipping, but let you return it to a store for free.
Glenn Gooding [00:13:50]:
Yeah, I saw the same returning to a store for free. So it's a reverse logistics omnichannel solution.
Cathy Roberson [00:13:56]:
Yeah, yeah. And it's kind of like that whole shipping that last mile. Instead of me sending an item to you by one of our last mile carrier friends to you, I can sit there and say, hey Glenn, come pick it up at the store. You come pick up your item in the store, I'll give you a coupon for 10% off your next purchase for sure.
Glenn Gooding [00:14:20]:
And I would think some of the advantages of offering free return at the store too is the inventory is immediately in the hands of the retailer. Yeah.
Cathy Roberson [00:14:29]:
Yes, it is. So the quicker you can get it back on that shelf, if it's in good enough condition.
Glenn Gooding [00:14:36]:
Condition. Correct.
Cathy Roberson [00:14:39]:
You could save some money.
Glenn Gooding [00:14:39]:
So you immediately have quality control on it. Somebody puts their eyes on it.
Cathy Roberson [00:14:43]:
Yes.
Glenn Gooding [00:14:44]:
And immediately be put on a retail shelf if in fact it is in good condition. Right. So I think that's an optimal solution. It does require a customer to get in the car and drive to the retail location. Right. So what if you didn't want to do that as a customer? You know what other options are out there in the marketplace for returns, Cathy, that are common. And I think you're spot on. The bracketing piece, what a burden it places on a retailer.
Glenn Gooding [00:15:13]:
Right.
Cathy Roberson [00:15:14]:
Yes. It just says extra cost. Yeah, it really is. We've not done a study on the cost of bracketing, but I can imagine it's enormous. It's enormous.
Glenn Gooding [00:15:26]:
Yeah. I mean, there was a day, I'm old enough to remember there was a day in the days of the UPS and FedExs of the world where returns were free.
Cathy Roberson [00:15:34]:
Oh, yeah.
Glenn Gooding [00:15:34]:
The outbound rate covered the return. And that's long since gone away. And so in essence, for anybody who doesn't realize this, a return, you're paying just about the same amount as you were on the outbound piece. Granted, there's some nuance. It's no longer a residential delivery and it may not be a delivery or a surcharge, zip code on the return and some other things, but you're paying a fully loaded transportation rate on the return. So it's a. It's a tremendous burden. On an E.
Glenn Gooding [00:16:01]:
Commerce channel.
Cathy Roberson [00:16:02]:
Oh, for sure. I know for rla, I do a quarterly return survey index. And every single quarter since, I've been doing it for the past couple of years, transportation cost and labor cost and handling the returns, those are the two biggest problems. It's not necessarily the volumes these days, it's the cost.
Glenn Gooding [00:16:27]:
And those costs never trend down, do they, Cathy?
Cathy Roberson [00:16:30]:
Not really, no. Yeah. And that's why a lot of times you see retailers encouraging you to come to the store to return your item. And those retailers are trying. It is a labor intensive process in handling returns. And there's been a lot of technology introduced in this space, but it has not replaced the labor. And I shouldn't call it labor. It's the workers.
Cathy Roberson [00:16:57]:
And trying to make, you know, to keep the workers is another issue too, because they're working in warehouses, they're having to inspect items piece by piece. So it's a visual inspection. It's also a smell inspection. So if you smoke and that smell gets on the shirts, guess what, you can't resell it.
Glenn Gooding [00:17:19]:
That's a good point. Yeah. So it's very, we'll call it labor intensive, right?
Cathy Roberson [00:17:26]:
Yes, very much so.
Glenn Gooding [00:17:28]:
Headcount and really Shrinkage in inventory ultimately, right?
Cathy Roberson [00:17:34]:
Oh yeah.
Glenn Gooding [00:17:34]:
That's where a lot of that stuff gets diverted to the Goodwills of the world, Right, right.
Cathy Roberson [00:17:38]:
Or to liquidators that will resell the items for pennies on the dollar either through ebay or another online platform such as that, or in various stores. You know, you see Bargain Huts and these other stores popping up in shopping centers across the US Reselling them.
Glenn Gooding [00:18:00]:
Yeah. So from a carrier perspective, from a small parcel carrier perspective, which carriers are kind of leading the charge on returns solutions?
Cathy Roberson [00:18:07]:
Cathy, that's difficult to say, to be honest with you. Now UPS acquired Happy Returns last year. That's a technology platform. So they've integrated that into their overall platform that they're selling to their customers and such. They've been a lot more vocal on returns of late. FedEx has done. They haven't made any significant acquisitions in recent years in this space, but they do offer a very strong returns solution as well. They tend to partner with a number of companies depending on what region you're in, Europe or the US in particular with that goal.
Cathy Roberson [00:18:55]:
Their goal for that is really to keep it local or as local as possible because God, you do not want to pay for a return going cross border.
Glenn Gooding [00:19:04]:
Yeah, for sure. As I see it today, you know, we've got UPS, we have FedEx and we have the USPS that offer a full door to door delivery solution for the US Right.
Cathy Roberson [00:19:16]:
As far as transportation. Yeah, yeah, definitely.
Glenn Gooding [00:19:20]:
So given that I think we've all experienced probably as consumers returning through one of those three carriers. Right. So I think the primary in the UPS world is to take it to.
Cathy Roberson [00:19:32]:
A UPS store or FedEx. Take it to a FedEx store.
Glenn Gooding [00:19:36]:
Yeah. FedEx office. Right. You know, I think the unsung hero as far as at least convenience for the consumer is the usps, Right.
Cathy Roberson [00:19:45]:
Probably so. I mean, when you're looking at it from a price perspective, I would venture an educated guess that they would be one of the lower, more reasonable priced options for sure, for all of them. Well, let me back up from a retailer's perspective. Another great way to please your customer is to offer that returns label in the box when you're shipping it to them.
Glenn Gooding [00:20:15]:
So that way, any hidden costs with printing A returns label. Any additional expenses for the retailer in that environment.
Cathy Roberson [00:20:24]:
No retailer doesn't seem to be passing that on to anybody unless it's baked into their price of the item that the customer as purchased.
Glenn Gooding [00:20:33]:
Yeah, I think there is a print return label surcharge out there, right?
Cathy Roberson [00:20:36]:
Oh yeah, there is.
Glenn Gooding [00:20:39]:
And I know the USPS is particularly unique in the fact that if you print a USPS label, you effectively printed cash. Right. You have to pre fund that. So there's. There's that dynamic going on.
Cathy Roberson [00:20:52]:
Yes, definitely.
Glenn Gooding [00:20:53]:
So I think it's a matter of kind of knowing your customer demographic probably and determining, given what you know of them and their tolerance for things, is finding a return solution that is the least burdensome for that given demographic.
Cathy Roberson [00:21:09]:
That's a good point. Yes, definitely.
Glenn Gooding [00:21:11]:
There's something to be said for being able to pop the shirt back into a poly bag with the USPS label on it and lift the flag up on your mailbox. There's something to be said for that.
Cathy Roberson [00:21:23]:
Exactly. Yeah. As my understanding though, with UPS and FedEx, you could put the label on the bag or box, leave it on your front steps and they can come and pick ups. Or FedEx would come and pick it up. But I would imagine that would be a pricier option.
Glenn Gooding [00:21:42]:
It very much would be. It would be a pricier option and probably reserved for more of a white glove type of experience, I would imagine, right?
Cathy Roberson [00:21:49]:
Yeah, probably so. Oh, and speaking of white glove, we haven't even mentioned larger items for returns like furniture.
Glenn Gooding [00:22:00]:
Yeah.
Cathy Roberson [00:22:01]:
And that's a whole different ballgame right there.
Glenn Gooding [00:22:04]:
Yeah, it's really tough, isn't it?
Cathy Roberson [00:22:06]:
It is. And that's something that UPS, I don't think likes to play in. Whereas FedEx has positioned FedEx Freight to help with not only deliveries but also returns of items such as that. And then there are also startups that focus just on larger returns. Let me back up here because I think UPS's roadie does pickups of larger items.
Glenn Gooding [00:22:35]:
Yeah, for sure. Yeah. The larger items, man, that's a whole other can that we could open. That's a Pandora's box, I guess we could open up. Yes, it is on that one. But it's interesting to me because it's from a revenue perspective, from a revenue management perspective, it's being attacked by the carriers. They're. They're infusing massive annual increases and demand surcharges and a variety of other things.
Cathy Roberson [00:22:58]:
Billing methodologies on that side, that whole esoteric. Additional handling.
Glenn Gooding [00:23:02]:
Yes, additional handling. Oversized, large package surcharge stuff.
Cathy Roberson [00:23:06]:
Yeah.
Glenn Gooding [00:23:07]:
And your only other option is ltl, which can be much pricier and a much lesser kind of customer experience on that side. So, you know, what I found is anytime you have a market like that that's getting so much cost pushed into it, it opens the door for innovation. So when you mentioned startups, you heard it here first, folks. I think between Cathy and I, I think that is going to be an area where you're going to see some unique startup solutions and approaches to that, let's call it underserved market. And it's tough if you're in the business of marketing and shipping out play sets for kids that get assembled in the backyard. Really hard to kind of re engineer that. So they still fit in small boxes. It's just kind of the nature of the beast, Right?
Cathy Roberson [00:23:54]:
Exactly.
Glenn Gooding [00:23:55]:
And last I checked, people aren't stopping having kids and kids still like to play on play sets. So it's still going to happen. Right. So it's a tough one in that range, you know, or if you're, if you're part of the Traeger, Traeger hood or, you know, any of these grills or pizza ovens or anything else that's going on out there. A grill is a grill. There's only, you know, they come in certain sizes, so.
Cathy Roberson [00:24:18]:
Exactly. And the furniture. Yeah, furniture sales have been kind of lacking since the pandemic because, you know, we all went out and redecorated our homes during the pandemic. But we're going to end up buying furniture. I think furniture sales will start to pick back up again. And if that's the case, more of us are buying furniture online. So I expect we're going to see some. The returns start ticking up in that particular category pretty soon for sure.
Glenn Gooding [00:24:48]:
It brings up another interesting question, Cathy, I wonder if you have thought on. So the fulfillment space is really great growing. There's a lot of three PLs out there. There's a lot of brands that feel like they'd rather just focus on the marketing and client acquisition efforts and allow an expert to handle the inventory, storage, the execution of the shipment. What are some additional things to consider for a brand if you are heading down the path of partnering with A3PL or fulfillment and you're still dealing with this reverse logistics conundrum. What are some important things to consider?
Cathy Roberson [00:25:27]:
Well, you better be able to understand their reverse logistics solutions, that's for sure. Costs are always important, of course, but understanding the services that they provide, the ability to communicate and where. What's their geographic Reach as well. And if it matches your geographic reach, for example, I mean, there's a lot of players in that fulfillment space, and we've seen some just close. I think trying to make a profit in that space is difficult, and I think we're beginning to see a fallout of those that can't make it and such. So you're just going to have to partner. Well, communications is extremely important. And those costs.
Glenn Gooding [00:26:15]:
Yeah, yeah, we keep talking about costs. I guess if we were to think of some takeaways on the costs. There's so many different facets to costs. Right. So there's a transportation component that's a real cost, and you have to understand that. You have to understand your client's buying patterns. You have to have good analytics around bracketing, as an example. Yeah, are.
Glenn Gooding [00:26:40]:
Are you getting one return for every three items shipped? You know, what's the ratio on that? What's your exposure? Have you contemplated your transportation strategy at the shopping cart to ensure that you're making a profit on those purchases? Have you designed a shopping cart in a buying experience that mitigates the possibility of bracketing returns? Fits like customer reviews, good colors, variety of other features. If you're shipping custom blinds, are you offering fabric swatches to go out quickly so that they can look at, hold it up against a wall ahead of time? Those types of things can really mitigate expenses. So that's the trick.
Cathy Roberson [00:27:27]:
Yeah. But even before that, what we've discovered within the RLA is a lot of times when you ask an RLA member or someone in the community, how much does returns cost you, they can't tell you that. They don't know. And that's also been one of the big problems of returns. Trying to manage returns is that returns can happen at any part of that retailer's business. It's very siloed. So one group within a retailer or brand may be handling their own returns. Another group is managing their own returns, but they're not talking to each other.
Cathy Roberson [00:28:07]:
So they don't know how much volume they actually have or how much it's costing them. So that's the biggest problem that they have to conquer first. Then after that, there are technology solutions available. They're beginning to come out on the market. A lot of it is, dare I say, AI driven, but in a good way to help you better understand your returns. Who's returning them? What's that demographic profile? What's being returned? Why? That's the other big question is why is all this, these items being returned? It's not Necessarily just bracketing. But it also could be something else. Maybe the packaging or there's no instructions or they don't understand the instructions that's provided in something that's been returned.
Cathy Roberson [00:28:57]:
So AI is helping those companies, those brands, retailers get a better understanding of their cost and what's driving those costs. So I just wanted to throw that out.
Glenn Gooding [00:29:09]:
No, it's good. So you have to get a handle on the costs. And the costs are across multiple groups within a company. The costs can be from a variety of factors from transportation to cost of carrying inventory to inventory shrinkage to handling at the return. Right. And the staff staffing required to do the inspection and doing that, the loss or the shrinkage. We talked about as far as what can be resold versus what has to go through another kind of wholesale channel or donation channel on that front for a write off.
Cathy Roberson [00:29:40]:
Now that whole donation, that's something that a lot of retailers and brands tend to forget as well. If you donate to a Goodwill or a local charity or such as that, that's a tax write off. So you are getting some money back hopefully by doing that as well as well as doing good.
Glenn Gooding [00:30:02]:
Yeah. So we've talked a lot about cost and I see an overlay. I threw out the term sustainability earlier. It's a real popular buzzword today. Can mean a lot of things, right?
Cathy Roberson [00:30:14]:
Yes.
Glenn Gooding [00:30:14]:
You know, proactively making or reducing the amount of returns in a supply chain is obviously a sustainability plus. But what are some other, let's say, very visible to the consumer perspective sustainability things could be considered in this. So that. Let's think about a brand who's who I would contend, whose client demographic is very, very attuned to sustainability re initiatives. Right. So a brand that comes to mind that kind of comes to the forefront, that would be like a Patagonia.
Cathy Roberson [00:30:48]:
Right, Right. Or REI as well.
Glenn Gooding [00:30:51]:
Yeah, those are, those are folks like to be out in the, in the woods, in the mountains, outside and they want the environment to be taken care of. What are other things to be considered in the reverse logistics? The returns side, to maximize sustainability, the ability to resell.
Cathy Roberson [00:31:08]:
Recommerce is what it's being called these days. From what I've read, what I've been told by RLA members, the ability to buy gently used items, vintage items is on the rise, particularly with the younger generations, which is good. The goal for all of this from a sustainability purpose is to keep the items out of the landfill, whether it's recommerce. Also the packaging, the use of the packaging.
Glenn Gooding [00:31:40]:
I was Going to say, what about the packaging, Cathy, on that front. What about the packaging?
Cathy Roberson [00:31:44]:
Yeah. So less is always more. Less is better, I should say, also to help reduce. And also the materials that go into that packaging as well. So as much as I like, you know, those little popcorn items that you'd see in boxes. Yeah. That's not exactly great for the environment.
Glenn Gooding [00:32:03]:
Yes. Stagger, fold.
Cathy Roberson [00:32:05]:
So using recycled material and such as that.
Glenn Gooding [00:32:10]:
Yeah. One thing I've always kind of chuckled at, being a small package geek as I am, is I'll order from a really large retailer. Let's say it's Amazon. I open up this giant box and I grab an item that's this big out of it.
Cathy Roberson [00:32:24]:
Okay.
Glenn Gooding [00:32:24]:
Everything else is all packing material. That could be a problem. Right. From a sustainability perspective, that can really turn off your client base, right?
Cathy Roberson [00:32:33]:
Definitely. Oh, God. It ticks me off when that happens to me from that space. But also from a cost perspective, that's not real smart either.
Glenn Gooding [00:32:42]:
True. Because you're paying to ship a lot of air, a lot of cardboard. Right. That you don't have to. For sure. Yeah, absolutely. Absolutely. There's cost there.
Glenn Gooding [00:32:50]:
But from a sustainability perspective, that's something that really be considerate of. What about messaging on some of the packaging material? As far as made from 100% recycled material, that can be powerful, right?
Cathy Roberson [00:33:04]:
That definitely can be. So when you're telling your customers that you're using recycled items or other types of sustainable material, that does send a very strong message to those that hold that dear to them.
Glenn Gooding [00:33:20]:
Yeah. The other thing that's always. That I've always appreciated is when you receive an item in a package and that package is designed to handle a return right there without any tape.
Cathy Roberson [00:33:31]:
Those reusable packages, those are great.
Glenn Gooding [00:33:33]:
You can repurpose that box very easily. Those are. Those are great, right?
Cathy Roberson [00:33:36]:
Ah, I love those. That is so smart.
Glenn Gooding [00:33:39]:
Yeah.
Cathy Roberson [00:33:40]:
I've seen that through Amazon, if I'm not mistaken. And I think UPS and FedEx offers that as well to some of their customers.
Glenn Gooding [00:33:50]:
They do.
Cathy Roberson [00:33:51]:
No, that is a good idea.
Glenn Gooding [00:33:52]:
Let's say you do your brand and you've. You devised a. You've thoroughly thought through this reverse logistics behemoth and you've thought through every phase and you have a plan for your inventory as it's moving back, whether it goes back on a retail shelf and gets resold or whether you have to go through some other discount channel to tender it off. If in fact you have a donation channel, one would think you could market that, that you're doing good for the underserved. Right. You're. You're making donations. You regularly donate returned items.
Glenn Gooding [00:34:27]:
There'll be an opportunity on that front as well that I think is powerful.
Cathy Roberson [00:34:30]:
Yeah. I think partnering with a charity is very important from doing good. But also, like you said, from a marketing perspective, I think that also shows a very clear indication of the sustainability.
Glenn Gooding [00:34:45]:
Yeah, for sure. This has been really interesting. I think if I were to try to distill this down into some takeaways for our listeners. One of the things that we kind of uncovered was first off, you really have to thoroughly understand your returns in your supply chain, your reverse logistics supply chain. You need to understand it through every phase and where product can be reintroduced into your supply chain. Going back to you, you have to understand those points and I think you have to have the data, the analytics around that to thoroughly understand what it's costing you. Right. What those costs are.
Glenn Gooding [00:35:25]:
You have to devise, I think, a plan to effectively mitigate returns whenever possible. That's prevention's the greatest mitigator there. Right. And somehow.
Cathy Roberson [00:35:38]:
Definitely.
Glenn Gooding [00:35:39]:
And you have to do this in a way that appeals to the consumer, that it comes across as a very sustainable program. Great ease of use. I can tell you that transportation is a big part of the expense there. And there are things you can do from a transportation perspective to ensure you get favorable return rates and programs on that front. And ultimately, you have to have a program in place that delights a customer so that during this busy holiday season, all this gift giving and this onslaught of returns that start December 26th. Right. That's an opportunity to really delight the client so that you get them coming back to order again from you.
Cathy Roberson [00:36:26]:
Exactly.
Glenn Gooding [00:36:27]:
So whether it's more of a white glove type of a return service or whether it's a well thought out return service where you have the ease of going to your mailbox or to a retail location, drive more foot traffic into your retail location to perhaps buy something while they're there. I think those are all key pieces to this on that front. Anything else you'd like to add for the audience?
Cathy Roberson [00:36:50]:
I think you pretty much got it. But here's one thing I wanted to note. Thank you to E Commerce. There are more and more returns happening before Christmas, before December 26th. So plan for those even during peak season as well as January, which has always been traditionally the returns month.
Glenn Gooding [00:37:15]:
Great. Well, I've really enjoyed this. Cathy, where can the listeners find you if they choose to want to reach out? What's the best way to get a.
Cathy Roberson [00:37:23]:
Hold of Cathy oh my goodness. Well, the best way is just really through LinkedIn. I'm on there.
Glenn Gooding [00:37:28]:
Okay.
Cathy Roberson [00:37:29]:
You can always email me, But I think LinkedIn is the best way to reach me.
Glenn Gooding [00:37:34]:
Okay, great. Great. Cathy, I really appreciate your insights and for the listeners, I hope we've offered some help and some insights. Maybe a couple ideas for you to contemplate. It might be too late to re engineer your reverse logistics this quarter right now during this holiday season, but hopefully it lays the groundwork for you to drive further efficiencies on that front. Again, I'm Glenn Gooding with Parcel Perspectives. You know where to find me. Look forward to addressing any questions or any further discussion you'd like to have with regard to reverse logistics or any other small parcel conundrum you might have.
Glenn Gooding [00:38:11]:
So thank you all until our next episode. Thanks for listening to Parcel Perspectives, hosted by me, Glenn Gooding. I've been in the small parcel space for 37 years, starting with a deep and broad background working for one of the major carriers as an operator and industrial engineer, later managing pricing at the highest level for the largest, most complex shippers in the world. Since then, I've been a national thought leader and work to help drive strategy for clients from Fortune 50 companies to startup e commerce businesses, helping them more competitively align in this complex and expensive market. If you enjoyed the show, please subscribe and share with friends. Join us next time for more expert advice and strategies to stay ahead of the shipping game.
.svg)
.svg)
