Working to reduce turn-around time of returns, we exceeded customer expectations.
Sector: Retail & E-commerce
Services: Decision Analytics | Operational Improvements
Timescale: 8 weeks
Returns in the e-commerce fashion sector are a given. What our customer wished to understand was how to most efficiently process returns in their central warehouse. In addition, what were the opportunities to use return stock in its international returns locations to fulfil orders?
The primary challenge in returns is ‘speed to availability’ – how can returned stock be made pristine again, and systemically made available for customers to buy? The challenge at the central warehouse was processing space, meaning that the processing had to be undertaken off-site.
Our solution to this was to size the operation, not just currently, but given forecast growth and envisaged spikes in demand. Given this, options around how much of the stock should be physically relocated to the main warehouse could be taken, based on ordering patterns (and the likelihood of this being purchased with stock, not in the returns location).
The same logic was extended to the international returns centre. Once all options had been processed mapped, the relative economic costs could be compared and the options evaluated. Overlaid on this were softer issues, such as the benefit to the business of having stock for sale in as few locations as possible, and the process simplification of ‘always’ treating returns the same way in a location.
The result was not ‘an answer’, but a framework to make decisions as volumes changed, and the proportion of stock passing through the external sites increased.
Given the twin objectives of maximising the opportunity to sell products and keeping business processes as simple as possible, we were able to provide the economic cost and process implications of each alternative at all forecast volume levels.