And the store doesn't get hit with the revenue loss. We've been successful in meeting customer expectations. In the process, they've addressed some pressing issues, including sales-tax policies, which part of the business takes the hit for the returns, and where the returns will be resold. A few companies are trying to make it easier with outsourced solutions that track and resell goods. Inbound packages cost two to three times more to handle than outbound ones because employees must inspect the return, repackage it, credit the customer, and put the item back into inventory, says David Schatsky, a Jupiter analyst.
Online sites average six to eight human touchpoints in the returns process.
Kmart Corp. Still, most online retailers haven't invested enough resources in reverse logistics to make returning merchandise hassle-free, Schatsky says. Like Nordstrom, Borders Group Inc. and Kmart have avoided such problems with flexible return policies that permit online returns at their retail outlets. Borders, in Ann Arbor, Mich., uses software from Brightware Inc. and E.piphany Inc. to track orders regardless of the channel or reason for the return. Because Borders' online unit doesn't operate separately, its stores don't have to worry about returns affecting their bottom line. BlueLight shares Kmart's reverse-logistics processing network, but the two units keep their data separate.