How should protective packaging factor into your reverse logistics strategy?

As shoppers and retailers head back to more routine day-to-day activities following the holiday chaos, one activity that is likely to continue well into February is gift returns. Returns are a routine cost of doing business for online retailers as part of a positive user experience. But the holidays offer more significant challenges regarding returns, particularly when you add more brick-and-mortar stores to the situation.

The National Retail Federation estimates consumers will return about 16.5 percent of their gifts. A UPS study puts that at around 23 percent – a quarter of the gifts given over the holidays.

Through supply chain challenges brought on by the pandemic, shifts in demand, labor shortages, and transportation delays, we’re seeing more retailers adopt a more aggressive approach to lessening the load in stressed warehouses. Strategies can include charging for returns or, when items cost more to ship than they are worth, offering a refund despite not taking back the unwanted product.

In cases where an item still has value after being returned, it is imperative to maintain the integrity of the product during shipment. The easiest way to do that is through effective packaging.

Once the decision is made to refurbish an item and sell it back to consumers, or a warrantied product is returned to its owner, protective packaging becomes the tipping point that makes the transaction successful or not. No one will regard receiving a broken shipment as successful.

There are a few areas where you can strengthen your reverse logistics process by improving the packaging solution in place at that point in the return process.

The first example is the most obvious, re-commerce. Any returns that have been officially deemed re-sellable often end up back in fulfillment center inventory, on the shelf at a store, or sold to liquidation companies for resale. In any case, once those items are re-purchased, they may be shipped directly to the consumer, and the need for reliable packaging is clear.
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