How to Manage eCommerce Returns and Exchanges for Your Business

Sherian Batallones


Last updated:

June 26, 2024
person dealing with eCommerce returns
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A great eCommerce experience doesn’t always end with your customers receiving their orders. Today, returns and exchange policies are a top  considerations online shoppers look for when purchasing from a brand. 

In fact, nearly 76% of Australian shoppers read a brand’s return policy before placing an order. This just proves how a brand’s eCommerce returns process factors into whether a customer would check out their order or abandon their cart. 

Effectively managing eCommerce returns is not just about addressing order mistakes – it’s also about constantly evolving to better serve customer needs. Embracing the challenge of returns is an opportunity to prove your commitment to customer satisfaction.

Reasons Why Customers Return Products

Customers return products for a multitude of reasons—sizing issues, expectation mismatch, change of mind, defective merchandise, just to name a few. Incorrect product descriptions or images can also mislead customers into buying something that doesn't match the reality of the product received. Sometimes, it's simply because they found a better price elsewhere.

Ensuring that your product listings are as detailed and accurate as possible can mitigate these issues. However, even with the utmost diligence, returns are an inevitable part of the eCommerce journey.

Grasping the reasons behind product returns, acknowledging the associated costs, and recognizing return rates can transform how a business approaches its return management in eCommerce. 

Moreover, implementing strategic steps and best practices can efficiently streamline the eCommerce returns process to ultimately drive smoother relationships with your customers.

eCommerce Returns and Exchanges: Costs and Average Return Rate

Returns and exchanges come with considerable costs for an eCommerce business. Apart from the lost sale, there are the logistical expenses of shipping, handling, and restocking. Additionally, the product's value may depreciate, or it may not be resalable at all. Not to mention, there's a significant administrative overhead in managing the returns process.

The average return rate can also vary widely depending on the industry. While it generally ranges from 20% to 30%, according to Shopify, fashion and apparel tend to see higher return rates due to fit and style preferences. Electronics, on the other hand, might see lower rates but higher costs per return due to the item's value.

Managing eCommerce Returns

A smooth and efficient returns policy can significantly enhance the customer experience, making shoppers more likely to return for future purchases. When customers feel confident that they can easily return unwanted or faulty items, they are more willing to make a purchase in the first place. 

This trust in the returns process can lead to higher conversion rates and increased customer retention, both of which are essential for the long-term success of an eCommerce business.

To manage returns effectively, or even avoid returns at all, consider these recommended steps and best practices:

Build a seamless returns process:

An uncomplicated and well-integrated eCommerce returns process ensures that customers can easily return items without unnecessary hassle or delays. This user-friendly approach can transform a potentially negative experience into a positive one, reinforcing the customer's trust in the brand. 

A seamless returns process can involve several key components, such as providing easy-to-navigate online return forms, clear instructions, and pre-paid return labels. These elements minimise the effort required from customers, making the return process almost as convenient as the purchasing process itself. 

Additionally, integrating return tracking into your systems allows your customers to monitor the status of their return in real-time, adding another layer of transparency and reassurance. 

Do quality control checks:

Implementing a robust quality assurance program can also help identify and address issues before products reach the customer. This proactive approach ensures that only items meeting high standards of quality and functionality are shipped, significantly reducing the likelihood of returns due to defects. 

By inspecting products at various stages of production and packaging, companies can detect and rectify potential problems early. Leveraging robotic order fulfilment also helps, as they minimise human errors during the packaging process, ensuring a more consistent level of quality that meets customer expectations.

Over time, a commitment to stringent quality control can build a reputation for excellence. Customers are more likely to trust and stay loyal to brands that consistently deliver high-quality products, knowing that their purchases are less likely to result in the inconvenience of returns.

Create a continuous feedback loop:

Creating a continuous feedback loop is also vital for gaining insights from returning customers and improving product offerings and descriptions. By actively soliciting feedback from customers who return products, businesses can gather detailed information about why the items did not meet expectations. 

This feedback can highlight specific issues, such as inaccuracies in product descriptions, size discrepancies, or quality concerns, which may not be evident through internal quality checks alone. Understanding these issues from the customer’s perspective allows businesses to make targeted improvements that directly address the root causes of returns.

Leverage an eCommerce returns management software:

eCommerce returns solutions are designed to streamline the entire returns workflow, from initiating the return request to processing refunds or exchanges. By automating these tasks, businesses can reduce the manual effort required, minimising the risk of human error and ensuring consistency in handling returns. 

This automation not only speeds up the process but also ensures that each return is processed according to predefined rules and policies, enhancing reliability and customer satisfaction.

Frequently Asked Questions About eCommerce Returns

To solidify your returns management process, answering customer queries regarding the returns process effectively and upfront can enhance the customer experience and reduce the burden on customer service.

Here are a few examples of FAQs normally asked by customers that you can put up in your website:

Q: How long does the returns process take?

A: The duration may vary, but clarity on timelines can be provided in the return policy.

Q: Can sale items be returned?

A: It depends on the retailer's policy, but this should be clearly stated on the website.

Q: Who pays for the return shipping?

A: Policies vary; some retailers offer free returns, while others may deduct the cost from the refund.

Q: What condition do returned items need to be in?

A: Typically, items need to be in their original condition with tags and packaging intact.

Q: Is there a restocking fee?

A: This will depend on the individual retailer's policy.

Optimising your eCommerce returns management process

Optimising your eCommerce returns management process requires a holistic approach that addresses both strategic planning and technological integration. A well-thought-out strategy lays the groundwork for effective returns management, but it is the implementation of advanced tools and technologies that truly enhances efficiency and customer satisfaction. 

For example, by incorporating solutions like same-day courier services for exchanges, you can transform returns from a logistical challenge into a competitive advantage. These services not only expedite the returns process but also delight customers with swift resolutions, fostering greater loyalty and repeat business. 

Ultimately, a seamless, tech-enabled returns process not only minimises operational costs but also elevates your brand’s reputation, positioning your eCommerce business as a leader in customer-centric service.