By implementing practical strategies and procedures for product returns, your company will increase revenue, reduce expenses, deliver greater profitability, and improve customer service levels.
Consumers often saw product returns as a necessary, unpleasant, and generally inevitable evil. Retailers and eCommerce companies frequently saw product returns as an annoyance, a cost center, and a region of potential consumer discontent between retailers, manufacturers, and retailers. As long as goods are sold, some returns will always occur. Moreover, the procedure of managing product returns was mainly ad hoc for many vendors. However, many successful organizations have recognized that the return process entails substantial costs and could benefit from an effective product return strategy. This constitutes a significant aspect of the reverse logistics system and offers many advantages. The returns of the product should be divided into two groups:
(1) controllable returns that can be prevented or reduced via the company’s actions.
(2) uncontrolled returns, about which businesses may do little or nothing in the near run.
Reverse Logistics Solutions can help you implement a strategic approach to reducing product returns using the FMEA (Failure Mode and Effect Analysis). FMEA is a method for evaluating and controlling the risk associated with potential failure sites. This well-known technique is used in a variety of fields, including process and product development.
Reverse FMEA is a systematic method of continuous improvement designed to keep an FMEA study up to date and moving forward. As a result, it is a tool that aids in the FMEA process.
The Reverse FMEA reviews all failure modes listed in the Process FMEA, performed by a multidisciplinary team in the warehouse and on the shop floor (reality), with the goal of ensuring that all failure modes have appropriate process controls in place for prevention/detection going forward.
The important steps for a Reverse FMEA are as follows:
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- Examining the existing process and its many components.
- In the current plan of action, there are gaps in the diagnosis of the real situation.
- Actual process efficiency is tested.
- Gather and evaluate real performance data.
- Update the goals of the process’s to meet requirements.
FMEA Benefits
The systematic use of the FMEA methodology provides many advantages to the business, including:
Gain experience and knowledge of your process and data on answering the ‘why’ a product was returned.
Set KPIs (Key Performance Indicators) on reducing costs and frequency of returns.
Reduce risks and costs of non-quality goods.
Share the FMEA knowledge to improve production processes.
Work on the most frequent cause of defects, which have the highest costs, then work down the list to determine the next most frequent cause of defects and put measures in place to correct it.
How can we help you?
Contact us to start working together ensures you’ll have clarity on the best practices in Reverse Logistics, which will ease the pain and reduce product returns.
The solutions are specific to your team’s needs. They are based on the ‘golden nuggets’ within your data that many clients are collecting internally, through the eCommerce and retail partners, third party logistics (3PLs), repair centers and refurbish, and the secondary markets. The data never lies; you need the expertise to interpret the data to turn it into functional decision trees. Many times, clients are too close to the data to recognize the patterns. I live at the intersection of Artificial Intelligence, machine learning, deep learning, and Reverse Logistics. It’s magical, and it can save you millions of dollars in costs. Let’s work together.
I have worked with Cliff over the past 3 years on a wide array of projects and I have been impressed with each and every project he has worked on for me! His recommendations are insightful and actionable. He is a very reasonable person and considers constraints when giving business advice.
“You played a large part in helping us to achieve our goals. You were able to maintain some degree of order while allowing all the participants to contribute in a way in which they felt recognized and their input valued…. Your perseverance would not allow us to rest on our insights. We appreciate your gentle insistence on our devising a concrete plan of action.”
“Cliff really is insightful and a good mediator. He offers a really good forum for us to meet weekly to discuss short & long term goals. I find that I hear things from my associate that I didn’t know he was thinking. It’s an organized weekly phone call … geared toward corporate direction and individual leadership growth. Cliff … draws the answer and direction out of each client and helps them move themselves forward. The weekly consistency really drives the process forward effectively.”