Edition 64
Why Customer Service Can Make or Break Your Reverse Logistics Strategies
by Peter Sobotta, Founder & CEO, Return Logic

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It might seem strange to consider customer service as a factor in your reverse logistics strategies. After all, a customer doesn’t have much if anything to do with warehouse procedures or issues like refurbish, restock, or resale. So in what way does customer service factor into your reverse solution?

A good customer service department can actually help your bottom line. Without it, you could be losing money or customer loyalty. With it, you might just avoid a return in the first place.

The customer plays a critical role
Imagine that a customer has purchased your widget. The customer can’t touch the item because your widget can only be ordered online so they call to ask questions about shipping, color and shape of the product.

On the phone, the representative is pleasant, answers all of the customer’s questions and, satisfied with the answers, the customer places the order. When the product arrives, however, the widget they thought was round and purple, turns out to be red and oval.



The widget is different from what they ordered and they want to make a return. Regardless of their prior experience, this critical moment is where customer loyalty is either made or broken.

How to institute a stronger RMA policy
One of the best ways to avoid a loss in customer loyalty during the reverse supply chain is to stop a return from happening in the first place. A returns management authorization (RMA) system is the first place to start. An RMA means customers call a service representative to discuss the return before receiving authorization to make one.

During that call the customer may be informed of a different set up method for their widget. They’re told the widget can be round and purple like they wanted. The customer support rep can walk them through the process.

The customer is happy and your widget doesn’t need to be returned after all. By simply managing an RMA process as part of your reverse logistics strategies, you may be able to cut down on returns, see increased profits and retain loyal customers.



How to lose a customer during the return process
Sometimes returns are necessary. Customer service plays a huge role in customer retention during the reverse chain. It can be easy to lose a customer at this time if you fail in these three areas:

1. Being vague about shipping costs and policies. Customers who expect free shipping, but find they have to pay, won’t be pleased. Or, if the customer knows it will cost to return but the cost ends up being much higher than they planned, that opens the door to bad feelings as well. Clearly stated returns policies and shipping costs should be included with every item you ship to a customer.

2. Availability of a replacement. Suppose your company does sell round purple widgets but the oval red widget was sent by accident. The customer is not going to be happy to learn they did everything right, but now you’re out of purple widgets. At times like this a solid RMA strategy can help clear up confusion and set the customer’s mind at ease.

3. Time to return and refund. This is another area where a customer deserves full disclosure. Including these terms in your sales contract and having an RMA team who is fully aware of your company policies, will work to eliminate customer confusion.

With an RMA strategy and a staff that understands your return policies, the customer is better informed and kept in the loop. They’ll feel valued by being included. A customer who feels valued by customer service is more likely to form a loyalty to your company even if they have to make a return.

RLM
Peter Sobotta is the founder and CEO of Return Logic, a technology startup focused on reverse logistics and reducing consumer returns through predictive analytics. Contact Peter at psobotta@returnlogic.com or @peter_sobotta.

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