Solution and Value
The Solution
E-Return offers the first total reverse logistics and product disposition service specifically designed to manage returned merchandise for e-tailers and multi-channel apparel manufacturers. While E-Return never assumes title of the manufacturer's merchandise, it does offer the most sophisticated and advanced service available to ensure minimal operations costs and maximum financial return on the merchandise.
Our service is composed of four components:
- Customer care
- Operations
- Product disposition
- Post-transaction supply chain management
Combined, the components represent a total solution that relieves the manufacturer of the costly and time-consuming reverse logistics process, while providing premier customer service and optimal performance.
Customer Care
The customer care component of E-Return's solution will enable the retailer's online customer to link to the E-Return website, designed as a seamless interface to the retailer's site, and automatically receive a return merchandise authorization (RMA) number for the merchandise to be returned. Customers only need to write the RMA number on the pre-paid and preaddressed E-Return return label, which is included with the original package, and can then conveniently place the package in the mail from their home or office. Also, online customers will automatically receive an e-mail confirmation once E-Return has received and reviewed the returned merchandise.
The returns process for mail-order catalog customers is essentially the same. These customers will also receive a pre-paid and pre-addressed mailing label with their purchase. If, however, the RMA cannot be assigned online because the manufacturer is not accessible online or the customer does not have access to the Internet, the customer need only call the manufacturer's customer service department to obtain the RMA number. The package can then conveniently be mailed to E-Return.
Operations
E-Return's operations component will incorporate both a web-based interface that seamlessly communicates with our client's website and a centralized return center (CRC) equipped with leading-edge technology and resources dedicated to the most-efficient processing of returned merchandise. Once the returned merchandise has been received, E-Return will immediately identify, inspect, and sort the clothing for resale or other disposition. E-Return's CRC staff will utilize a combination of bar-coding, warehousing technology, and inventory management systems to ensure rapid processing and precise control of the merchandise. Since E-Return's focus is the management of merchandise returns, the processing of returns is the highest priority. This enables a substantial reduction in obsolescence costs due to inefficiency or oversight.
Product Disposition
After the merchandise has been sorted, E-Return will prepare it for resale or other disposition. E-Return's custom-built product management and disposition management applications will allow the apparel manufacturer to establish and modify merchandise resale and disposition policies in real-time to reflect each manufacturer's branding and re-distribution strategy, product life cycles, and goals for maximizing financial returns on the returned garments.
E-Return will also design a dynamic business-to-business exchange to facilitate the resale and charitable contribution of returned merchandise to secondary markets, thereby avoiding inventory build-up at the manufacturer's warehouse and the potential for loss due to shrinkage. The exchange is continually updated to reflect available merchandise both in the warehouse and currently in shipment from the customer. The manufacturer will determine the parameters of each sale to the secondary market. The exchange will also govern the donation and destruction of items according to the disposition parameters established by the manufacturer.
Post-Transaction Supply Chain Management
E-Return's solution creates the only information system available that provides the manufacturer with complete post-transaction supply chain management and control capabilities. From the moment the customer generates an RMA until the resale or alternative disposition of the merchandise, the manufacturer has access to real-time knowledge of the volume and value of merchandise in the reverse logistics channel. Consequently, the manufacturer will be empowered to better control manufacturing quality, inventory, product life cycles and customer satisfaction.
The Value Proposition
As the first and only provider of reverse logistics services designed for e-commerce and multi-channel apparel manufacturers, E-Return is uniquely positioned to improve every aspect of managing returned merchandise.
Reduced Processing Costs
E-Return incorporates the benefits of a centralized operation, a highly-efficient merchandise handling process, and innovative technology to reduce the manufacturer's reverse logistics costs by an average of 22 percent per item, based on estimated labor costs and overhead. These cost-savings directly impact our client's bottom line.
Increased Sales
E-Return's services will result in increased and more profitable sales by facilitating the returns process and improving the manufacturer's ability to cross-sell merchandise. E-Return minimizes the unpleasantness and inconvenience of returning products, thereby restoring customer confidence in the manufacturer and increasing the likelihood of future sales.
Improved Financial Return on Merchandise
E-Return's system will improve our client's average recovery on returned merchandise by an estimated 5-10 percent by minimizing customer and warehouse holding times. Our convenient and easy-to-use process encourages online customers to promptly ship return items. In fact, E-Return will automatically generate reminders to customers who have registered a return but have forgotten or neglected to mail the merchandise. Once received at E-Return's centralized return center, the merchandise will be immediately processed and prepared for resale or an alternative disposition.
Moreover, E-Return's web-based, business-to-business exchange will provide secondary marketers the opportunity to bid-up the purchase price on the returned merchandise—further increasing the manufacturer's cost recovery.
Enhanced Customer Care
E-Return's system will greatly enhance the manufacturer's ability to provide customer care by improving the convenience and ease of returning merchandise by providing the consumer with an easy-to-use, web-based interface that automatically registers the return and generates an RMA number. Also, customers will be provided with return labels that include a return address and pre-paid postage and will be notified upon E-Return's receipt of the merchandise.
E-Return's system enables manufacturers to customize return policies for online and direct mail customers by dictating the shipping and restocking charges for each customer. This allows the manufacturer to reward loyal customers and discourage the abuse of favorable return policies.
Improved Supply Chain Management
E-Return's unique system allows the manufacturer to manage the post-transaction portion of the supply chain, tracking returned merchandise from the moment it is registered into the system until its ultimate disposition. Post-transaction supply chain management provides numerous benefits to the manufacturer including improved manufacturing quality control, inventory and product life cycle management, and customer satisfaction.
Improved Asset Utilization
The main challenge in today's rapidly changing e-commerce and multi-channel environment is not to commit to assets that do not support a company's core competency or limit its flexibility, according to Andersen Consulting's supply chain management practice. E-Return will provide e-commerce and multi-channel apparel manufacturers with the first opportunity to capitalize on a reverse logistics solution specifically designed to satisfy their requirements without requiring significant capital expenditure.
Customer Care, Operations, & Product Disposition
E-Return's approach to reverse logistics eliminates the hassle of managing returns and improves our client's bottom line. The company's unique "one touch" handling process reduces our client's returns processing costs by an average of 22 percent, based on conservative wage estimates for employees to receive, credit, handle, and redirect returned items and for onand off-site warehouse space. E-Return also reduces obsolescence costs by reducing customer return and merchandise handling time. Finally, E-Return increases the resale value of the returned merchandise by first aggregating the apparel and then making it instantly available to secondary markets through E-Return's dynamic secondary market business-to-business exchange.
Technical Infrastructure Overview
Management Team & Board of Advisors
Appendix A: Financial Assumptions & Statements
Appendix B: Management Team & Board of Advisors
Appendix C: Consumer Survey Results
Appendix D: a Note on E-Return's Technical Infrastructure
Appendix E: the Status of E-Return's Intellectual Property
Appendix F: E-Return's Fee and Commission Schedule
