Categories
Cosmetics

Beauty Fulfillment Returns: What to Ask a 3PL About Damaged Products

Key Takeaways

  • Beauty fulfillment returns require specialized, high-touch inspection due to fragile components (liquids, glass, seals) and high customer expectations around product integrity and unboxing experience.
  • Damaged returns should be processed within an optimal 1-2 business days and tracked at the SKU level through each stage: pending inspection, approved for restock, quarantined, or removed from inventory.
  • A reliable 3PL should never automate the inspection step of beauty fulfillment returns. Any product failing quality checks must be routed to quarantine or documented disposal, never back to active stock.
  • WMS dashboards should give brands real-time visibility into return status, inspection notes, and damage trends without requiring manual follow-up.
  • Beauty packaging should be designed with fulfillment in mind, prioritizing shock absorption, leak prevention, and tamper evidence alongside aesthetics, to reduce return rates at the source.
  • Choosing a 3PL with clear, documented reverse logistics workflows is one of the strongest indicators of long-term fit for beauty brands.

Your inventory management works effortlessly between orders and deliveries, and the same should apply to beauty fulfillment returns, especially when damaged products reenter your operation. Uncertainty at this stage creates inventory and brand risk. You want to know whether the product is still in good condition, eligible for restock, or permanently removed from inventory.

A 3PL partner should have a clear understanding of the delicate nature of beauty product fulfillment, from packaging and kitting to handling liquids, fragile products, and glass. You want to know that, while automation works in other areas of fulfillment, there’s a real person inspecting product returns to protect your brand and build trust with your customers.

Why Beauty Fulfillment Returns Require Specialized Handling for Damaged Products

As a brand operating in the beauty industry, your product comes under greater speculation than other industry types, and that’s because customers focus on both product integrity and presentation. Your customer wants a memorable unboxing experience as much as a quality product. The added layer of customer expectation and trust in your product places beauty fulfillment returns in a higher-risk category.

Damaged products require thoughtful handling to support safety, brand integrity, and inventory accuracy, especially for beauty and skincare brands. Your skincare product returns handling process should balance speed and brand protection at every step.

Why Damaged Products Are More Complex in Beauty Fulfillment

Damaged products in beauty fulfillment carry an extra layer of complexity, as many SKUs contain liquids or fragile components. Your products should have intact seals and complete kits to ensure they remain sellable. How well you maintain quality standards throughout this process determines whether your product meets those standards and qualifies for restock.

Why Returns Affect Brand Trust and Customer Experience

Receiving a damaged product or a replacement that does not meet expectations can undermine trust, even when you resolve the issue quickly. Unboxing consistency supports brand consistency and trust, as customers expect products to arrive intact, sealed, and well presented.

Why Unclear Return Workflows Create Operational Risk

Clear order fulfillment return workflows reduce operational risk by introducing inventory alignment and efficient decision-making. Without defined processes, damaged products may remain counted as available inventory or remain unresolved for extended periods. Poor internal visibility makes it difficult for teams to understand return status or take action. These elevated expectations make the practical realities of handling damaged beauty products more complex than they may initially appear.

How Professional 3PLs Should Handle Damaged Beauty Products

Your 3PL fulfillment team should have a clear workflow to determine what happens to the beauty product when there’s a return. The decision-making process should include a physical inspection to ensure the product and packaging meet the restocking criteria.

Stage What the 3PL Does Why It Matters for Beauty Brands
Intake Logs returns by SKU and routes them out of active inventory Prevents your damaged products from being counted as available stock
Initial Inspection Checks for leaks, breakage, missing components, or tampering Identifies issues common to liquids and fragile items
Packaging vs. Product Review Separates outer packaging damage from product integrity issues Avoids unnecessary disposal when products remain compliant
Quality Control Checks Confirms visual condition, seal integrity, and SKU-specific compliance Ensures products meet your brand and hygiene standards
Restock Decision Approves eligible items for return to inventory Maintains accurate inventory management
Quarantine Holds items needing further review or clarification Prevents premature restocking
Disposal Removes unsellable items with documented records Protects brand trust and accountability

Key Questions to Ask a 3PL About Cosmetics and Beauty Fulfillment, Returns and Damage

When partnering with a 3PL, it’s important to understand how they handle returns for cosmetics and beauty fulfillment. Questions to consider asking include:

How Are Damaged Beauty Products Identified and Categorized?

Your 3PL should identify damaged beauty products through a defined inspection process that separates packaging damage from product compromise. Inspectors within the returns workflow must check seals, caps, pumps, liquid leakage, and kit integrity before assigning a damage category. Your beauty fulfillment partner should label each returned unit with its SKU and a documented condition status that determines whether it can be restocked or removed from inventory.

The manual step matters because even minor seal damage can make a product unsellable. A reliable 3PL uses SKU-level rules to protect your brand standards and prevent compromised products from reentering circulation. Research shows that 81% of returns are due to damaged or defective items.

What Inspection Steps Occur Before a Restock Decision Is Made?

Your 3PL should complete a multi-step inspection to confirm product safety and resale eligibility before restocking a returned beauty product. This process includes visual checks for leakage or contamination, and seal integrity verification. Your kits must be reviewed as complete units, not as individual components. Inspection should always accompany restock decisions, and it’s not advisable to automate this inspection step. Your fulfillment team should route beauty products that fail any step to quarantine or documented disposal to protect customers and preserve trust.

How Should Damaged Beauty Returns Appear in Your Warehouse Management System (WMS)?

Your 3PL’s WMS should show damaged order fulfillment returns at the SKU level with real-time condition status, inspection notes, and responsibility clearly assigned. The dashboard should show you whether a unit is pending review, approved for restock, quarantined, or removed from inventory. Documentation should be visible to your team without manual requests.

Clear insight allows brands to track damage trends and maintain inventory accuracy. Without it, damaged products create blind spots that affect forecasting and customer experience.

How Should a 3PL Handle Disposal and Documentation for Damaged Beauty Products?

Disposal should follow a documented process tied to the original return record when you can’t restock a beauty product. Your 3PL should record the reason for disposal and immediately update the inventory status. Accurate record-keeping creates a traceable audit trail without slowing your daily operations.

Clear disposal documentation protects your brand from compliance risk and prevents unsellable products from reentering inventory. Record-keeping identifies recurring damage caused by packaging or handling.

How Quickly Are Damaged Returns Processed?

Process damaged beauty fulfillment returns quickly after receipt to improve inventory efficiency and real-time status updates. A reliable 3PL inspects and categorizes damaged items within a defined service window, often within one to two business days, so inventory status is updated without lag.

Fast processing ensures you know whether products can be restocked or removed from inventory before those units affect your order accuracy or availability. Speedy, consistent returns handling keeps inventory management accurate and gives teams access to the information they need to resolve customer issues quickly.

How Does the 3PL Determine Restock Eligibility?

A 3PL determines restock eligibility by applying SKU-specific inspection criteria. Inspectors evaluate each return for product integrity, seal condition, completeness, and presentation to confirm it meets your brand standards for resale. Your fulfillment team assesses packaging damage separately to determine whether it affects the product itself or only the outer appearance.

Restock approval requires that the item show no signs of leakage, contamination, or tampering for beauty and skincare products. 3PLs route products that do not meet these standards to quarantine or removal, which ensures only compliant inventory returns to active stock to preserve brand trust.

How Are Disposal and Destruction Handled?

Your 3PL handles disposal and destruction through a documented process tied to the original beauty fulfillment return record. The 3PL records the reason for removal, updates inventory status, and follows approved disposal procedures to ensure the item cannot reenter circulation when your product is deemed unsellable.

Disposal and destruction documentation is critical for protecting and accounting for beauty and skincare brands. Clear records support accurate inventory management, confirm proper handling, and help brands identify recurring damage patterns tied to fulfillment.

How Are Exceptions Communicated to Brands?

Beauty fulfillment teams communicate exceptions through clear, timely updates that provide clarity into what happened and why. A 3PL should log exceptions at the SKU level, including inspection notes, timestamps, and status changes, so your team can review issues without manual follow-up.

A 3PL escalates exceptions through a client success manager who provides context and recommended next steps. This escalation process keeps brands informed and ensures exceptions don’t disrupt inventory management or the customer experience.

a worker handles beauty products returns at a fulfillment center

WMS Visibility for Beauty Fulfillment Returns: What Your 3PL Should Show You

Your returns insights should be specific and tied to real inventory decisions to maximize value. Partner with a fulfillment team that understands the importance of going beyond reporting a product return when you’re in the beauty and skincare industry. You’ll need to know the next steps at the SKU level to protect inventory integrity and maintain your customers’ trust.

SKU-Level Return Status and Condition Tracking

Correct SKU updates are a critical part of your business and help you manage your inventory more efficiently. With beauty fulfillment returns, you need a WMS that’s reliable and accurate in these updates. You’ll need to know where the item is in the process:

  • Pending inspection
  • Approved for restock
  • Quarantined
  • Removed from inventory

This access to real-time data shows you where returned units stand without waiting for manual updates. SKU-level tracking prevents compromised products from being counted as available inventory, supporting accurate forecasting and order fulfillment decisions.

Inspection Notes, Timestamps, and Accountability

View the inspection notes for each returned unit. These notes explain why an item was quarantined, restocked, or removed, along with timestamps that show when each step occurred.

This level of transparency creates accountability across beauty product returns workflows and gives you confidence that your 3PL consistently applies inspection standards. It reduces back-and-forth communication and helps your team resolve customer issues faster thanks to verified information.

Reporting on Damage Trends and Root Causes

Gain access to your returns data aggregated in clear WMS data reports that reveal where damage is occurring and why. You should see patterns related to packaging performance and seasonal spikes in return volume. With the WMS data insights, you can implement proactive improvements such as adjusting protective packouts and refining handling rules during peak periods.

Packaging, Prevention, and Process Improvements

You can reduce the number of damaged beauty and skincare product returns before your customer receives the order. Beauty and skincare brands should design product packaging and fulfillment processes to account for fragile components, liquids, and presentation standards. Your 3PL plays a critical role in preventing damage by applying packaging strategies and handling rules that align with SKU-level requirements.

Why Beauty Packaging Requires Fulfillment-Specific Design

Beauty packaging needs to meet more than just shelf appeal; it also needs to withstand the realities of fulfillment, including storage and delivery. Beauty products require finesse, unlike other consumer goods. Beauty products are vulnerable to damage, leakage, and temperature sensitivity during deliveries, making fulfillment-specific design a critical consideration from the start.

Beauty Products Are Fragile and High-Risk in Transit

Common elements in beauty packaging include glass bottles, pumps, droppers, compacts, and mirrors. These have higher breakage risks during picking, packing, and delivering. By designing packaging to protect these components, brands lower the rate of beauty fulfillment returns and product loss, and reduce customer dissatisfaction.

Fulfillment-ready design accounts for:

  • Shock absorption and internal stabilization
  • Leak prevention for liquids, oils, and serums
  • Tamper-evidence and seal integrity

Packaging Must Balance Protection and Brand Experience

Beauty customers expect a premium unboxing experience. Your packaging should prioritize aesthetics and functionality while withstanding weight and movement during transit. Fulfillment-specific design ensures packaging:

  • Maintains visual appeal while adding structural integrity
  • Fits efficiently into delivery cartons to reduce movement
  • Protects branding elements like labels, foils, and finishes
Dimensional Efficiency Impacts Fulfillment Costs

Design your beauty packaging with shipment in mind so you have the right-sized boxes that use space efficiently and reduce dimensional weight charges. Over time, you’ll save on delivery and storage costs. Designing packaging with fulfillment considerations allows brands to:

  • Optimize carton sizes for standard delivery tiers
  • Improve palletization and warehouse storage density
  • Reduce material waste and delivery expenses

Compliance and Consistency Matter at Scale

As your beauty brand grows, your packaging needs to grow along with it. Your packaging needs to perform consistently, whether you’re fulfilling thousands or millions of units. Fulfillment-specific design reduces manual handling errors and helps meet regulatory and carrier requirements for cosmetics, liquids, and aerosols. Packaging designed with fulfillment in mind maintains these benefits as order volume grows. When packaging is designed for fulfillment, brands benefit from:

  • Faster, more reliable order processing
  • Reduced packing errors and damaged shipments
  • A consistent customer experience at scale

Choosing a 3PL That Protects Your Brand From Damaged Beauty Returns

Cosmetics and beauty fulfillment returns play a role in inventory accuracy. You build customer trust and brand consistency by handling damaged products with clear inspection standards. Experienced 3PLs offer defined workflows and SKU-level decisioning.

As you evaluate fulfillment partners, their approach to reverse logistics is one of the clearest signals of long-term fit. Boxzooka can support the fulfillment process by reviewing how your beauty brand manages returns for damaged products.

Fulfillment workflows and a proprietary warehouse management system give brands the control and access to the data they need to protect inventory and the customer experience. Contact Boxzooka to discuss a beauty fulfillment returns strategy built for accuracy and transparency.

Categories
Fulfillment

What is a 3PL? What eCommerce Brands Need to Know Before They Outsource Fulfillment

If your team is spending more time packing boxes than building your brand, it is likely time to take a serious look at third-party logistics. The term “3PL” gets used constantly in eCommerce circles, but what it actually means, and what a good 3PL relationship looks like in practice, is worth unpacking carefully. Here is what you need to know before you make that decision.

Key Takeaways

  • A 3PL, or third-party logistics provider, manages warehousing, order fulfillment, shipping, and returns on behalf of eCommerce brands.
  • A full-service 3PL can support receiving, inventory storage, pick and pack, carrier management, returns processing, and value-added services such as kitting, bundling, personalization, and subscription box assembly.
  • For many growing brands, outsourcing fulfillment can convert fixed warehouse, labor, and technology costs into a more variable operating model.
  • Warehouse location and network design are major factors in 3PL selection. The right footprint can reduce shipping zones, improve delivery speed, and lower transportation costs.
  • Key criteria for evaluating a 3PL include industry fit, technology, eCommerce integrations, demonstrated operational performance, pricing transparency, communication, and the ability to scale during peak season.

A 3PL Manages the Operational Work Between You and Your Customer

3PL stands for third-party logistics. When you work with a 3PL, you ship your inventory to their warehouse. From there, they handle everything downstream: receiving and storing your products, picking and packing individual orders, and shipping them directly to your customers.

Consider this. Every order your business ships requires warehouse space, trained staff, packaging materials, carrier accounts, and software to track it all. A 3PL handles all of these logistics for you, operating as an extension of your business.

You retain full visibility into your inventory and order status. The 3PL absorbs the infrastructure, the labor, and the carrier relationships. You focus on your product and your customers.

The Services a Full-Service 3PL Actually Provides

Not every provider offers the same scope of services, so it is worth knowing what to ask for. A full-service 3PL typically handles everything from inbound to outbound logistics:

  • Receiving and putaway: When your inventory arrives, the warehouse team unloads it, inspects it for accuracy and damage, and assigns it a storage location tracked in a warehouse management system (WMS). You can see exactly how many units you have and where they are at any time.
  • Pick and pack: When an order comes in through your eCommerce platform or marketplace, warehouse staff pull the correct items, package them according to your specifications, and prepare them for shipment. For brands that care about the unboxing experience, this step is where your 3PL either earns your trust or loses it.
  • Carrier management and shipping: The 3PL generates shipping labels, coordinates with carriers like UPS, FedEx, and USPS, and applies negotiated rates that benefit from their shipping volume. Because 3PLs aggregate shipping volume across multiple clients, they may be able to provide access to competitive carrier rates and a broader mix of shipping options than many brands can secure on their own.
  • Returns processing: Reverse logistics are handled on your behalf. A strong reverse-logistics process helps brands recover value by quickly inspecting returned products, determining disposition, refurbishing or repackaging when appropriate, and returning sellable inventory back to stock.
  • Kitting and assembly: Subscription boxes, product bundles, gift sets, promotional inserts, and custom assembly work can all be managed at scale. For brands running monthly subscription programs or seasonal gift campaigns, this is a meaningful differentiator.

The Economics Make More Sense Than Most Brands Expect

When you fulfill orders in-house, your costs are largely fixed. You pay for warehouse space, staff, and systems whether you ship 200 orders a month or 2,000. You carry those costs through slow months and then scramble to find additional capacity when volume spikes during peak season.

A 3PL converts most of those fixed costs into variable ones. You pay for the storage space you actually use, the orders that ship, and the labor involved in processing them. When volume is lower, your costs drop. When it spikes, the 3PL absorbs it without you having to hire seasonal staff or find temporary warehouse space on short notice.

For most eCommerce brands, the crossover point where a 3PL becomes more cost-effective than in-house fulfillment comes earlier than expected. Once you factor in the true cost of your own time, the overhead of a warehouse lease, the loaded cost of labor, and the carrying cost of inefficient inventory placement, a 3PL often wins on unit economics well before you hit high order volumes. For many brands, outsourcing starts to make economic sense once monthly order volume becomes consistent enough to justify a more formal fulfillment operation. Some brands begin evaluating 3PLs around a few hundred orders per month, but the right timing depends on order complexity, SKU count, storage needs, shipping profile, and internal labor constraints.

The real comparison is not just 3PL fees versus internal labor. Brands should compare the fully loaded cost of in-house fulfillment, including warehouse rent, labor, payroll burden, packaging, systems, equipment, management time, error costs, returns handling, and shipping.

The Signals That Tell You It Is Time to Make the Switch

There is no single right moment to bring in a 3PL partner. But a few signals tend to come up consistently:

  • You are shipping to customers across the country from a single location, and long transit times are hurting your customer satisfaction scores or conversion rate.
  • Your team is hitting capacity limits and peak seasons are creating genuine operational strain.
  • The cost of managing fulfillment in-house is climbing faster than your order volume.
  • You are launching on a new channel, such as Amazon, a retail wholesale program, or a subscription model, and your current setup cannot support it cleanly.
  • You want to expand internationally and need a partner with cross-border shipping experience.

Any one of these is a reasonable trigger. The combination of two or more usually means the window to act is now.

Location, Technology, and Communication Are What Separate Good 3PLs from Great Ones

A 3PL’s warehouse location directly affects your customers’ experience. The right 3PL footprint depends on your customer base, order profile, and inventory strategy. Some brands benefit from one strategically located facility near major parcel hubs. Others benefit from a distributed network that places inventory closer to customers and reduces average shipping zones.

Technology is equally important, and it is where many 3PLs fall short. Strong 3PLs maintain a strong WMS and client portal that provide visibility into:

  • Real-time inventory by SKU and location
  • Order status
  • Shipment tracking
  • Receiving status
  • Returns status
  • Inventory adjustments
  • Reporting by channel, SKU, order type, and exception

Your fulfillment partner should also integrate directly with your eCommerce platform, whether that is Shopify, BigCommerce, WooCommerce, Magento, or a marketplace like Amazon. Orders should flow automatically from your storefront to the warehouse floor. Technology development should be speedy and responsive to your pain points and needs.

Proactive communication and transparency are not optional features. They are the foundation of a working partnership. Ask any prospective 3PL how they handle exceptions, what their order accuracy rate is, and how they communicate when something goes wrong. The answers will tell you a great deal about whether the relationship will hold up at scale.

What Else to Evaluate Before You Commit

Beyond location and technology, a few other factors are worth weighing:

  • Industry fit: A 3PL that specializes in bulky industrial goods is not the right partner for a fashion or beauty brand. Look for a provider with demonstrated experience handling your product category, including any relevant compliance or handling requirements.
  • Scalability: Ask how the 3PL handles peak-season volume increases and what their capacity headroom looks like. A provider that is already operating near capacity is a risk. A partner that is equipped to scale with you is key.
  • Pricing transparency: Ask for a full rate card upfront, including storage fees, per-order fees, receiving fees, return processing fees, and any minimums. Hidden fees are one of the most common sources of frustration in 3PL relationships.
  • References: A reputable 3PL should be willing to connect you with current clients in a similar product category. A conversation with a brand that has worked with a provider for two or three years will tell you more than any sales presentation.
  • Client success and communication: Ask who will manage your account, how often you will review performance, how exceptions are escalated, and whether the support team is close enough to the operation to solve issues quickly.

Questions to Ask a 3PL

A strong 3PL eCommerce fulfillment partner should be ready and able to answer these questions:

  • Can you show us your WMS and client portal?
  • What performance metrics do you track and share with clients?
  • What are your order accuracy and on-time shipping rates?
  • How do you prepare for peak season?
  • What fees are not included in standard pick, pack, storage, and receiving charges?
  • How do you handle returns inspection, disposition, and restocking?
  • Who manages our account, and how are exceptions escalated?
  • What product categories do you specialize in?
  • Can you provide references from brands with similar order profiles or SKU complexity?

We Built Boxzooka Around the Brands That Need This Most

At Boxzooka, we work with growth-stage fashion, beauty, and lifestyle brands that need more than a generic fulfillment house. Our fulfillment centers span coast to coast, so we can position your inventory closer to your customers and shrink the average shipping zone across your order base. For most of our clients, that translates directly into lower shipping costs and faster delivery times.

Our technology-enabled platform integrates seamlessly with Shopify, BigCommerce, WooCommerce, Magento, and other major platforms, so orders flow from your storefront to our warehouse floor automatically. Through our Client Experience Portal (CXP), you get real-time visibility into every unit in storage and every order in process, plus the reporting you need to make decisions with confidence.

As a boutique, high-touch 3PL, we handle the full range of eCommerce fulfillment: kitting and assembly, subscription box programs, branded and custom packaging, personalization, returns management, and cross-border shipping. We are also built for complexity, whether that means deep SKU profiles, wholesale and retail orders running alongside your DTC channel, or specialized handling for premium products. Because we built our operation around eCommerce from day one, our team understands what it takes to protect your brand at every touchpoint.

What sets us apart is simple: we shape our operation around your business, not the other way around. Many providers force brands into a one-size-fits-all model, and we do the opposite, building flexible workflows that fit how you actually sell. Our goal is to be the best, not the biggest, so we are selective about the clients we take on and genuinely invested in helping each one scale and thrive. When our clients grow, we grow, and that alignment drives everything we do.

Let’s Talk About Your Operation

Whether you are actively evaluating 3PL partners or just beginning to assess whether outsourcing makes sense, Boxzooka can help you understand your current fulfillment model, identify cost and service opportunities, and determine what the right next step looks like. Contact us today and let’s get started.

Categories
eCommerce Guides

How Retailers Can Keep Growing Returns Costs in Check

While most retailers have recently recorded a decline in returns, the cost burden is still big, and many retailers are increasingly looking for ways to reverse course even further.

It’s retail’s unavoidable story, especially e-commerce: For each percentage of growth in sales comes more returned items from customers. It’s the double-edged sword that keeps getting sharper, year after year.

And while to some, the 2023 holiday retail season may seem already far away in the rear-view mirror, the true picture of the most recent season of holiday returns is only now becoming clear. The end of January marks the unofficial close of the preceding holiday retail season with the final act of returns. 

The National Retail Federation (NRF) expected holiday returns for 2023 in the U.S. to total around $148 billion compared to $171 billion for the 2022 holiday season, $151 billion during the 2021 holiday season, $101 billion in 2020, and about the same $100 billion for the 2019 holiday season.

While the rate of holiday returns year-to-year may be on the decline for the first year since the pandemic, these numbers fail to tell the whole story. In 2019, before COVID-19 upended consumer buying habits, retail returns for the entire year stood around $309 billion, or 8.1% of total retail sales. They peaked in 2022, more than double that 2019 figure, at $816 billion for the year or 16.5% of sales. In 2023, the total returns declined for the first time in years, at $732 billion or 14.5% of total retail sales.

So, while most retailers have recently recorded a decline in returns, the cost burden is still big, and many retailers are increasingly looking for ways to reverse course even further.

How pandemic changed returns game

It’s hard to believe that it’s been a little over four years since the pandemic changed things forever. Back then, lockdowns and distancing turned ecommerce into the next best option to in-person shopping. From there things took off. According to the NRF, before the pandemic retail growth in 2019 the year-over-year growth in e-commerce was at 3.5%; then in 2020 it jumped to 7.6%, then to 14.4% in 2021, and back to 7% in 2022. Growth in 2023 was expected to drop again to somewhere between 4% and 6%.

COVID’s enduring change to retail is reflected the most on the e-commerce side. It drove millions of consumers to online shopping, who would have otherwise hit up bricks and mortar shops. And while the rate of year-to-year growth may be slowing, there’s a huge new contingent of loyal e-commerce shoppers that won’t give up the new-found ease of digital shopping any time soon.

E-commerce has always been saddled by the returns problem. The more people shop virtually, the more likely they are to return items they couldn’t try on or “test” out before making the purchase. With the new pandemic “crop” of e-commerce consumers, returns will only become more problematic for those retailers that fail to optimize this side of their business.

It’s no longer a seasonal chore where the biggest hit comes during the holidays. Today, for a thriving e-commerce business, returns must be viewed as a year-round, always-on business strategy.

High costs = more restrictive policies

In 2022, for every $1 billion in sales the average retailer lost $165 million in returns, a number that gets bigger and bigger with each passing year. The pandemic saw a lot of returns policies eased, but as the emergency faded, retailers have increasingly looked for more ways to reduce their burden.

The expenses associated with accepting a returned item can oftentimes exceed the item’s resale potential, with shipping costs eating up a huge chunk of that value. Add on top of that the cost of manpower for processing and other key actions within the returns pipeline, it’s no wonder retailers are looking for better options.

Some have implemented fees for returning items while 58% of retailers went to “returnless” or “keep it” returns protocols in 2023. Others are offering store credit in lieu of refunds and some are encouraging shoppers to bring unwanted items back to the physical store. It’s a tricky balance, keeping customer loyalty front and center while putting stronger policies in place to right size the business. Thankfully in the world of retail, customer loyalty isn’t exclusive of a restrictive returns policy.

So how do we balance these business needs while maintaining strong customer relationships?

Maximizing returns at crunch time

For all the tips that can be covered in this context, one thing stands out: Getting returned merchandise through the system quickly and back to stock for potential resale is paramount. For this reason, returns need to be treated with the same urgency as outbound orders.

Focusing on “forward fulfillment” is the key to achieving this velocity, especially when it comes to the annual crush of holiday returns. This means having a strong third-party logistics (3PL) partner that can help manage returned goods, redirecting them to a new destination for processing, repackaging, and resale. Streamlining the returns process in this way, reducing transportation costs, and speeding up the return-to-market cycle, is the end game. Certainly, retailers can achieve this on their own, but a strong 3PL eliminates the hassle and gets it there quicker.

There are other things retailers can do, too: 

     

      • Be prepared: Preparation is key for success during the hefty return season after the holidays. Planning for an influx is critically important. This means having a clear and efficient returns process, which includes a dedicated team to handle returns, a clear returns policy, and a streamlined system for processing returns. 

      • Analyze the data: It’s essential to understand why the product is being returned in the first place. Analyze the data on returns to identify patterns and trends. This can help businesses understand the reasons for returns and take additional steps to address them. 

      • Communicate with customers: Communication is key when it comes to handling returns. Shoppers expect transparency during the returns process and to be kept informed. Communication builds trust and loyalty, giving customers confidence that your business will take good care of them. Having the proper tools and a robust returns plan will alleviate future problems. Make sure customers know what to expect.

      • Automate where possible: Automation helps streamline the returns process and can reduce the burden on staff. Simple tools can include using barcode scanning or RFID technology to track returns, automated emails or SMS texts to keep customers informed, and analytics tools to identify return trends and patterns. 

      • Look for opportunities: Businesses constantly evolve to improve the customer experience. In December 2023, DoorDash and Uber announced a new service: a return Package Pickup service that lets a driver pick up one to five packages from the customer’s doorstep and drop them off at a FedEx, UPS, or USPS location for them. Ensure your customer knows every convenience imaginable to guarantee you’re providing the best customer service possible. 

    While returns remain a significant challenge for online shoppers and stores alike, they can also be an opportunity with the right approach that addresses returns all year round. By being prepared, analyzing the data, communicating with customers, looking for opportunities, and automating where possible, online retailers and stores can handle returns efficiently. More importantly, focus on the relationship you’re building with your warehouse fulfillment center or 3PL. They’re your secret weapon in handling returns easily while building customer trust and loyalty. 

    In just a few short months, the ramp up to the 2024 holiday season will begin. Now is the time to review your returns protocols, take a deep dive into the 2023 season’s data, and build a more efficient system for the season ahead.

    By Tom Behnke

    Categories
    eCommerce News

    Porch Pirates on the Prowl This Holiday Season: Here’s How to Outsmart Them

    Your package tracking app reports, “Delivered,” yet there’s no trace of the package by the front door. Has your parcel fallen prey to porch pirates? You’re not alone. According to a survey by C+R Research, about 14% of Americans have had packages stolen by the now-infamous porch pirates.

    As consumers prepare their homes for the holidays, porch piracy poses an unfortunate threat to both online orders and the Christmas spirit. Many families look forward to decorating their homes with lights and inflatables, dressing up their trees with ornaments, and hiding gifts under the branches.

    According to C+R Research, 22% of households have had two packages stolen, while 11% lost three or more packages to these scallywag’s. That amounts to millions of thefts nationwide when more people than ever are relying on e-commerce for holiday gifts and necessities.

    U.S. Cities With Highest Parcel Theft

    The risk of porch piracy isn’t equal everywhere. An analysis of FBI crime statistics by Safewise found the highest rates of package theft happen in larger, more densely populated metropolitan areas.

    Seattle has the dubious honor of being number one, with 6.1 package thefts per 1,000 people. Other cities topping the list included San Francisco (5.9), Portland (5.6), and Los Angeles (4.9).

    Rural areas tend to see lower incidences of porch piracy. The lowest rates were in locations like Rapid City, South Dakota (0.2 thefts per 1,000) and Bismarck, North Dakota (0.3).

    Wherever they happen, these thefts collectively add up to substantial financial losses. On average, each stolen package is valued at around $112.30. The most commonly stolen packages are from Amazon, containing clothing, followed by books, toys, health/ personal care products, and groceries.

    What Attracts Porch Pirates

    What attracts the attention of porch pirates most? According to Brendan Heegan, CEO of Boxzooka, a leading fulfillment company, the top factor is flashy branding on packaging.

    “The number one thing that draws thieves is big and colorful logos or labels on the outside of boxes and mailers,” says Heegan. As a company that works with retailers to enhance supply chain and warehousing, Boxzooka has insight into what makes parcels enticing targets.

    Heegan’s advice? “Use generic outer shipping packaging to cover up any branding. Make the shipment look as boring and unappealing as possible to thieves.” Concealing prominent logos and labels helps prevent deliveries from standing out and catching the eye of opportunistic criminals on the prowl.

    10 Ways to Outsmart Porch Pirates

    Consumers must take precautions to ensure their preparations and presents are not ruined by theft. 

    • Opt for delivery to your workplace. Fewer packages sitting unattended at home means fewer opportunities for thieves. Consider asking neighbors if packages can be delivered to their homes if you know you won’t be home.
    • Require a signature for delivery so packages aren’t just left on the porch. However, requiring signatures can delay delivery if you’re not home.
    • Invest in a doorbell camera or outdoor security camera so any theft can be captured on video. Popular brands like Ring and Nest are relatively inexpensive deterrents. Consider multiple cameras covering multiple angles for complete protection.
    • Use a secure parcel drop box. Products like Loxx Boxx bolted to the home provide a safe space for couriers to leave deliveries out of sight from thieves.
    • Opt for the added security of Amazon Lockers or UPS Access Points for your packages. The use of these lockers is often free with their delivery services. If these aren’t nearby, explore having deliveries sent to your local grocery or pharmacy for a secure alternative.
    • Sign up for carrier text or email alerts so you know the exact delivery time and can try to be home. Work from home or have a friend pick up packages if you can’t be there.
    • Consider installing motion-activated lights around the perimeter of your home. Bright lights can scare off thieves looking to sneak up under the cover of darkness.
    • Fill out a vacation hold with your local post office so packages don’t accumulate if you’re away. Ask neighbors to keep an eye out and secure any deliveries as well.
    • Buy insurance when ordering more expensive items online. Look for the insurance offered by the vendor or delivery service, which may cost a few extra dollars. 
    • Buy online, pick up in-store. For more expensive items, collecting your item personally from the store may be the best method to avoid porch piracy.

    What To Do if Your Parcel Is Stolen

    If you become a victim of porch piracy, there are important steps to take.

    • Contact the delivery company immediately to report the theft and file a claim. Major carriers like UPS and FedEx offer insurance for lost or stolen packages.
    • File a police report. While packages may be a low priority, having a record of the theft could help if the criminal is caught. It may also qualify you for reimbursement from your renters’ or homeowners’ insurance.
    • Check with neighbors to find out if the package was mistakenly delivered to the wrong address. Thieves often target entire blocks.
    • Monitor local buy/sell sites and Craigslist in case the stolen goods are being resold locally. Collect evidence to provide to police.
    • Consider installing security cameras around the home as a preventative measure going forward. Video doorbells and outdoor cameras have helped identify culprits in many package theft cases.

    Taking prompt action is key to recovering lost items or getting reimbursed when falling victim to a porch pirate’s crimes. Remaining vigilant is the best ongoing deterrent against this type of theft.

    As online shopping booms, so do criminals’ attempts to steal unattended deliveries. Being vigilant and using common-sense security measures can help ensure packages arrive safely this holiday season.

    By Tom Behnke

    Also published on Media Decision.