Supply Chain Disruptions & the Labor Shortage Showcases Need for Returns Management Systems


The U.S. economy’s labor shortage is unprecedented in scope – accelerating global supply chain disruptions and forcing nearly every industry to compete for workers. In a recent Korn Ferry survey 100% of survey respondents from the retail industry reported having trouble hiring distribution center employees, with 40% citing “significant” challenges. The lack of workers to fill those jobs significantly affects retail supply chain operations, especially with the busy holiday season around the corner. Holiday shopping leads to holiday returns. How will companies process those returns without the proper staff or a returns management system in place?

Retailers, 3PLs, manufacturers, and anyone with a large facility are especially feeling the crunch. Most companies need an answer to the labor shortage now, and it’s about more than simply finding people. The right technology solutions – cost-efficient and bottom-line effective – can immediately soothe the stress of too few workers. By investing in a robust returns management system (RMS), e-retailers can take back control of managing their retail returns and ultimately increase brand loyalty and profit margins.

A typical returns process can be a headache for both customers and retailers. Integrating an RMS solution that streamlines the returns process is a way e-retailers can relieve the pressure. A solution to the labor shortage cannot take months to implement. An RMS can be up and running in six weeks or less, leading to quick returns for companies. It’s easy to use – so employees are willing to adopt it, reducing manual work, which increases efficiency, and creates a more positive work culture and enhanced customer experience.

Implementing a holistic approach to enhance current processes with advanced, AI-enabled technology can increase net profits when companies across the supply chain are asked to do more with fewer resources. An automated, cloud-based RMS platform focused on managing the reverse logistics process does just that. This is achieved by the RMS platform breaking the logistics of returns into three focal points – initiation, processing, and tracking/recovery — to streamline the returns process across the supply chain.


Return Initiation and End-to-End Visibility

The process of returning an item should be as simple as buying it, so it is essential to have a strategy in place to make the “post-purchase” experience as seamless as possible to promote a positive customer experience. This includes keeping customers informed of the status of the requested return. Providing updates of the status of their return eliminates the need to call customer service for updates, allowing for organizations to optimize the use of their workforce. An RMS solution manages this process and provides critical visibility for the seller to gain valuable insight into why a product was returned — helping limit fraudulent return activity, which made up  6% ($25.3 billion) of last year’s returns.

Once the product return has been initiated and arrives at the warehouse, the platform assists with repackaging and restocking, recycling, scrapping, returning to the vendor, liquidating, or disposing of the product – ultimately orchestrating and managing employees across departments, from start to finish.


Returns Processing and Tracking & Recovery

The subsequent phases of the returns process focus on leveraging data to determine the most appropriate shipping protocols and restocking plans based on cost, location, and facility fulfillment needs. As the number of returns continues to rise and warehouses are inundated due to labor constraints and supply chain disruptions, an RMS platform can remove the complexity of placing a returned product back in inventory by automatically determining which warehouse to send it to before final disposition. Then, the system automatically deploys recovery efforts to reduce inventory waste and profit loss.

Offering returns processing helps retailers improve profit margins, conversion rates, and customer satisfaction. By automating and optimizing reverse logistics processes, supply chain leaders can enjoy advanced visibility for better efficiency, configuration for faster workflows, and the necessary tools to provide quality after-sales care while significantly reducing operating costs. The current supply chain disturbance and labor shortage is a worrisome pain point for many retailers, but the best way out of this temporary problem is to utilize advanced technology specifically designed to help during the easy times and the trying times. A positive experience can be created by offering an accessible and convenient returns process that more effectively manages the supply chain’s many facets.


About the Author

Gaurav Saran is CEO of ReverseLogix, the only provider of end-to-end, centralized, and fully integrated returns management systems built for retail, e-commerce, manufacturing, and 3PL organizations. Prior to founding ReverseLogix, Saran led enterprise sales for Fortune 500 companies at Microsoft. He has held leadership positions at numerous start-up organizations, successfully transforming them from early stages to established growth companies.