A warehouse worker is assigned to find you and take you to the area where you will be packed up to be shipped. The order goes from the company’s website to the WMS, or warehouse management system used by the warehouse workers. You’re being summoned! Someone has visited your company’s website and ordered the very type of toothbrush you are. This is the first step in your journey through the warehouse. A warehouse worker takes you, still in your packaging, to a specific area of the warehouse to stay with the other toothbrushes based on your SKU, or stock keeping unit. After being manufactured, you are shipped to a warehouse that has been chosen as a good place for you to temporarily stay until you’re shipped to a customer. Today we’re going over some of the operational basics of a warehouse through the lens of a product arriving and then leaving a fulfillment center, or warehouse-read on to learn more!
Poorly run warehouses lead to losses in profit and dissatisfied customers, as well as dissatisfied warehouse workers. The process of packing and shipping affects the company’s profit as well as overall customer satisfaction.
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Overall, returns should be seamless for the consumer, customer service should be ready to answer customer questions and solve problems to diminish the number of returns, and businesses should have a plan on how to most efficiently take in returns, evaluate them, and then either dispose of or re-market the items.įor companies looking to shake up their reverse logistics, get creative! Always make sure that the process makes sense for your bottom line, but also look for ways to make a positive impact with your customers and community.What is the importance of warehouses in logistics? Warehouses are important to businesses everywhere as they are the place of inventory for products that are being shipped out to customers. In this case, Chewy wins by contributing positively to society, the customer has a positive association with Chewy because it facilitated their donation, and Chewy ultimately saves on potentially huge return logistics costs. Several reviews for Chewy, a pet food and supply online retailer, noted that instead of having a customer return an incorrect item or an item that was the wrong size, the customer was fully refunded and then prompted to donate the item to an animal or shelter who could use it. This not only eliminates huge amounts of low-value products from the reverse supply chain, but also saves companies a significant amount on shipping.Ĭompanies have even been using this strategy to encourage giving from customers. This approach does not apply to all products, but namely products where it would be more expensive for the item to be returned, evaluated, and then either disposed of or resold. Major retailers like Walmart, Target, and Amazon have an even newer approach to returns: no returns at all. Amazon still must collect, evaluate, and either dispose of or remarket the product after it is dropped off, but pre-paid postage and other potential costs are mitigated. Amazon, for example, allows returns to be accepted in-person at Kohls locations. Although eliminating the cost of returns is impossible, some companies have become creative and even partnered with other retailers to mitigate costs. Zappos customers are surely thankful for the lenient policy however, anyone in supply chain who sees the word ‘free’ knows that someone is absolutely paying for it.Ĭompanies should focus on making returns both painless for the customer and wallet friendly for themselves.
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Zappos, for example, has a very generous return policy that allows customers to return qualifying items within 365 days of purchase for a full refund. Many companies strive to make the returns process painless for customers to improve their customer experience and even encourage further spending down the road.
According to UPS, they are “on track to process more than 60 million return packages between November 14, 2021, and Janua 10% increase over last year.” Best Practices and Examplesįor any company, big or small, returns are a large undertaking, and if not handled correctly, can have a significant impact on your income. We are just coming off a very busy holiday shopping season with record spending, and record returns have been on its heels. Reverse logistics is the movement of a product upstream from the customer back to the retailer and when purchases increase, returns also naturally increase.
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