How to Handle Post-Holiday Returns Rush

In 2023, $173 billion worth of products were returned in a post-holiday return rush. This followed a massive success during the holiday season, where more goods were sold in a single holiday season since the pandemic.

As we have seen repeatedly, when the holiday sales rush subsides, there will always be a post-holiday surge of product returns. And it can be challenging. That said, while returns can rattle retailers, they should not overwhelm their business operations. Managing these returns efficiently can significantly reduce the impact of returns on your business.

The trick is to minimize the ‘likelihood’ of these returns, and you can do that by enhancing accurate product descriptions, precise sizing and fit guides, and pre-purchase customer support.

Of course, the best returns are those that never happen, but the million-dollar question is whether minimizing their chances is enough to completely stop customers from returning products. Chances are no. We have outlined the following steps to help you optimize the post-holiday returns process.

1. Optimize reverse logistics.

2. Leverage data analytics and insights.

3. Have a clear and transparent return policy.

4. Invest in training and hiring the right people.

5. Integrate an efficient returns management system.

Read our piece for a more in-depth review of these strategies.

Industry Voices

“Returns have been relegated to retail operations as a cost center, and reverse logistics operations are significantly behind in the sophistication that forward logistics processes have achieved.”

• Gaurav Saran,? CEO and Founder ReverseLogix

Know Your Term

Post Holiday Returns

What is it?

Post-holiday returns are product returns that happen after the major holidays, usually after Christmas and leading up to the new year.?

These returns are not always the fault of the business. They typically happen because people exchange unwanted or incorrect items or return items bought during sales without due diligence, such as checking fit. The major holidays are a high-volume period for retailers and logistics companies, leading to increased returned goods being processed, restocked, or discarded.

Why does it happen?

This rush happens primarily because gift-giving leads to recipients receiving items that don't fit, aren't to their taste, or are duplicates.?

Additionally, the increase in online shopping has contributed to a rise in returns, as customers often buy multiple sizes or variations of an item to try at home. Holiday sales and promotions also play a role, as many customers impulsively buy items, only to reconsider once the season is over.

How can you minimize the impact?

Retailers and logistics providers can minimize the impact by improving their returns process and policies.?

This includes implementing better customer service and support, encouraging in-store returns to reduce shipping loads, and offering exchanges or store credits to help manage the influx. Technology such as AI-driven returns processing can also speed up the workflow and help streamline operations during this hectic period.

What’s Up in The Market?

Asia-Europe Air Cargo Demand Surges as Tighter US Regulations Limit Trans-Pacific Flow

E-commerce continues to power the air cargo industry. In October, the industry saw rates spike from Asia to Europe, driven by increased demand from e-commerce platforms. This was in contrast to a decline in China-to-US tonnage fueled by increased US customs scrutiny, particularly on duty-free imports. Shipments along the Trans-Pacific route have suffered reduced volume by up to 37% year-over-year. Meanwhile, the demand for air freight in Hong Kong and Europe has risen 25%, buoyed by global shopping events and smartphone launches.

NRF Rallies Support for Retail Crime Bill Amidst Legislative Hurdles

National Retail Federation (NRF) continues to push the "Combating Organized Retail Crime Act" with the initiative to expand federal enforcement against organized retail crime, which is now in its third consecutive year. However, the push has only seen limited legislative progress. Most recently, the NRF hosted "Fight Retail Crime Day," encouraging retailers and stakeholders to advocate for the bill. With bipartisan support but limited data, the organization is committed to gathering evidence to highlight the rise in retail crime while members lead store tours to illustrate its impact.

Holiday 2024 Retail Outlook: Gen Z & Millennials Drive Early Shopping Surge

The 2024 holiday season is shaping up to be more profitable than anticipated for retailers because of rising consumer confidence and favorable economic indicators. U.S. holiday online sales now stand at $241 billion, a significant 8.4% growth. Gen Z and millennials, motivated by online shopping, sustainability, and personalized categories, are anticipated to lead this spending surge, while older generations prioritize value and gift-giving traditions.

UPS Projects Softer Holiday Peak Season Amid Shorter Shipping Window

UPS anticipates a slightly muted peak season as a shortened shipping period between Black Friday and Christmas Eve may drive more consumers to shop in stores. Although peak season volume forecasts from major clients have been revised, UPS expects Q4 revenue growth thanks to strong surcharge retention and a new U.S. Postal Service contract, replacing FedEx for USPS air cargo.

The Feature of The Month

Prevent Product Returns with ReverseLogix's Returns Management System

Managing product returns can be as complex and costly as they come.

While manufacturers and retailers are increasingly seeing it as a competitive edge, if the end-to-end returns process is not well integrated, it can completely disrupt the supply chain. That is where ReverseLogix's Returns Management System (RMS) comes in, designed to streamline and simplify this process and help control expenses.

Retailers, 3PLs, e-commerce brands, and manufacturers have leveraged our system to lower operational costs and enhance customer satisfaction by improving the overall returns management process and preventing unnecessary returns.

Why Are Product Returns So Challenging?

1. High Processing Cost

Returns in eCommerce often come with substantial costs, including refunds, shipping, restocking, and inventory management. These expenses can add up quickly, impacting your bottom line.

2. Complicated Inventory Management

Managing returns can make it difficult to maintain accurate inventory levels. Without careful tracking, manufacturers may face issues like overstock or stockouts.

3. High Risk of Return Fraud

Fraudulent returns can result in severe financial losses. Stringent policies and verification processes are essential to protect against return fraud.

How to Prevent Product Returns with ReverseLogix's RMS

1. Streamline Returns Process to Reduce Costs

Our system reduces the costs associated with processing and managing product returns by automating returns. Accurate tracking of returned goods ensures proper inventory levels, helping to avoid issues like overstock or stockouts.

2. Prevent Return Fraud

Our system is designed to catch fraudulent returns by implementing gatekeeping strategies and identifying suspicious activities.

3. Quality Assessments

Thorough quality assessments allow you to determine whether returned products can be resold or need to be disposed of, ensuring better returns management.

4. Data & Analytics

Our software analyzes return data to identify patterns and reasons for returns, helping retailers and manufacturers reduce future return rates.

5. Customer Communication & Customizable Portal

Enhance customer communication and streamline the returns process with a customizable portal, improving customer satisfaction. A clear and straightforward return policy is also critical. It builds trust with your customers and makes the return process easier to manage.

Scenario Spotlight

When a popular American footwear brand faced overwhelming returns, it became clear their long-standing SAP system couldn't keep up.?

With 115 U.S. stores, 300 international locations, and numerous online partners, managing returns had spiraled into chaos. The brand needed a better solution and needed it fast.?

ReverseLogix stepped in, streamlining the process while integrating with their warehouses, 3PL partners, and global operations.?

The system gave the company full visibility, allowing teams to track returns seamlessly.?

Printing multiple labels became a thing of the past as everything was consolidated into one. Inventory management and sorting improved drastically, cutting handling time and boosting efficiency. Returns processing sped up by 50-60%, and detailed reporting provided valuable insights.?

The easy-to-use system ensured quick adaptation for employees and partners, transforming returns from a headache into a smooth, efficient operation.

Testimonials

"It’s a streamlined solution that makes training really easy, and the ReverseLogix team is willing to work with us on whatever we need. It’s been a huge benefit.”