How to Handle Holiday Returns in Ecommerce

The holiday shopping season is a make or break time of year for most e-commerce companies. Having a successful holiday retail season requires more than piling up sales, however; it’s the aftermath that can truly change everything.  Managing holiday returns well can enhance your customer’s brand experience and strengthen customer relationships. Holiday returns give retailers the chance to build strong customer relations, increase brand value, and commit higher sales along the year. In fact, 74 percent of consumers report that a hassle-free return policy can persuade them to buy from an online retailer, regardless of whether or not they have purchased items from the retailer in the past, according to DotCom Distribution.

This past holiday season was the time for increased selling opportunities, strong sales, and an abundance of customers. It’s also the season of post-holiday returns. According to Bargainista, one in three people returned at least one gift last year. National Retail Federation reported that total annual returns reached $260.5 billion in 2015 — or 8% of total retail sales.

Too many online retailers gear up for holiday sales and then fall short when it comes to managing holiday returns that inevitably happen in late December and January. Online retailers experience 10 to 15 percent return rates – and that number skyrockets to 20 to 30 percent for apparel.

E-commerce businesses can find themselves in a difficult position if they aren’t prepared to handle the sudden influx of returns after the holidays. Most customers have no patience for brands that fail to process returned merchandise fast and accurately — they just want their money back, NOW. So how do you handle your ecommerce returns quickly and effectively?

There are two aspects of handling ecommerce returns for businesses: customer satisfaction and company satisfaction.

Customer Satisfaction

The first part of handling returns is satisfying the customer. Retailers should make it easy for customers to return their purchases. If a purchase is difficult to return, both company and customer satisfaction will suffer. From your customers’ perspective, post-holiday returns should be simple and seamless. Prepaid return labels, flexible return shipping options and other details improve loyalty by making it easy for customers to return unwanted items and receive either a refund or replacement.

Business Satisfaction

The second part of handling returns is essential for business satisfaction. If you handle your returns by sorting them with reasons such as “Resalable”, “Return-to-vendor”, or “destroy”, return categorization will not only be efficient, but fast, too. Retailers should take necessary actions to complete these processes in the most efficient manner. Three ways to do this are:

  1.      Use a WMS to receive returns. Not all products are returned for the same reason. Although some returns can be reintroduced to inventory, other returns (e.g., broken or defective items) can’t be resold. A WMS defines the rules and processes that you need to sort returned goods fast.
  2.     Effective workforce labor planning. Even automated return processes require human intervention. However, many online retailers don’t scale staffing to accommodate post-holiday returns. If you can’t accurately plan your workforce or return volumes, it’s critical to work with an experienced third-part logistics provider to make sure that you have the people in place to handle high return volumes.
  3.     Real-time return-status monitoring. It’s extremely frustrating to not be able to see when merchandise has been returned, especially when inventory problems arise. Warehouse management systems offer the functionality to report the return status.

Do you need an Inventory Management System?

Meet one of our industry experts to see our product’s free live demo.

How to Optimize Inventory For Next Year’s Holiday Rush

For multi-channel retailers, the holiday season within the fourth quarter is the single most important sales period of the year. Multi-channel retailers make almost 40% of their annual sales in the fourth quarter. The majority of these sales occur in a six-week period between November 1st and December 15th. Now that the latest holiday season is over, it’s more important than ever to begin planning for next year. That’s why getting well-prepared for the holiday season and optimizing inventory not to run out-of-stock in the middle of the season is the most crucial task that retailers can do for their business.

From an inventory management perspective, the holiday season is a perfect storm of challenges from extremely high demand and a short sales period to relatively long vendor lead times. On top of that, you’ve got to worry about preventing tying up your money in excess inventory, overloading your freight and shipment services supply, and over-stressing your warehousing and fulfillment staff.

So many things can go wrong in one month that it might seem like you’re navigating through an inventory minefield! After spending so much time preparing and executing marketing, sourcing, merchandising and operations plans, it can be a huge letdown to discover there’s not enough inventory left to serve the demand. Making sure you make the right inventory management decisions in the fourth quarter can take your business from mediocre to extreme success.

One of the most targeted tasks you can do to prepare for the next holiday season is optimize your inventory. Here are our top four ways to optimize your inventory for next year’s holiday rush:

Accurate Demand Forecasting

Ultimately, effective inventory management relies on accurate demand predictions. We can’t know what quantity of an item we need to keep in stock without knowing our future sales predicted levels. Accurate demand forecasting is the best solution to this problem.

Accurately forecasting demand and adjusting reorder quantities is the first step to having a successful holiday season. For effective demand forecasting, specific tools should be used that can compare lead times for your products and readjust reorder quantities accordingly.

demand forecasting tools like those included in an inventory management system analyze past sales data for each product to give an accurate demand forecast of each product in our inventory. Specific attributes, such as seasonality, past holiday demand, and marketing campaigns are used to forecast demand.

Syncing Product Advertising With Demand Forecasting

There are many aspects of a business that can affect the future sales of a given product. The trends within the market itself play a large role. The growth of your company also provides insight into future sales. However, there are many decisions that are made on a day-to-day basis that can result in fluctuating sales.

For example, listing a product on your homepage can result in a sharp spike in sales as opposed to burying it in it’s listed category. It is vital to coordinate your marketing promotions with inventory management staff to ensure your inventory can handle the influx of sales. This helps you focus on advertising products that have the biggest positive impact on your business.

Retailers that take this into account can expect their inventory management to be more efficient. Product advertising should take stock levels and turnover rates into account. Retailers who couple these two functions have a better chance to find optimal inventory balance.

Today there are more tools than ever to help online retailers with demand forecasting and inventory optimization. Many retailers opt to automate the process entirely through an inventory management system. This is because it can provide more accurate results than trying to establish it by hand.


Syncing Order Scheduling with Demand Forecasting

Forecasting can only get you so far with holiday prep, especially when you forget to forecast the most obvious hurdle; when your supplier goes on vacation. You should make sure that they can fulfill your orders on-time before they take their own holiday time off. Otherwise, they won’t have time to receive products into our warehouse or ship them to 3PL warehouses or Amazon FBA. The best way to do that? Factor in deadlines into your demand forecasting.  

Make sure to build schedules for three different parameters for each supplier: vendor, warehouse, or product. For example, when you create a vendor order schedule, you should be able to include or exclude specific order dates. By building this schedule and assigning it to the items that you order from that specific vendor, you can adjust future holiday-based orders. You should also be able to adjust the reorder quantity to cover the time when your supplier is out and open the purchase order early enough for your vendor to ship it.

You should also create a schedule for when you can receive orders and ship to Amazon FBA. For example, assume your company takes time off during the holidays. Amazon FBA has deadlines to have the products at their warehouse dock in order to ship on time. You can make sure to exclude those dates from your schedule. When you set the date for reordering, you should set it far enough in advance so that you receive the purchase orders early, and thus have the stock available for sale.

This is not an easy task, and balancing everyone’s schedules against your own can be very time-consuming. That’s why many inventory optimization software tools offer the functionality to automate scheduling and synchronize it with demand forecasting.

Maintaining Customer Service Success

Holidays can satisfy or totally damage your customer service levels. Your business ensures reliability and loyalty as soon as you prove that you know what your customers want. Keeping up this level of high customer service success can be difficult during the holiday season. After all, years of reliable and on-time order fulfillment may build up a loyal customer, but it only takes one unfulfilled order to destroy that loyalty.

It is more important than ever to go above and beyond with customer service during the holiday season. To do so, you need to make sure you have everything, and that it will be on-time. Optimizing your inventory and scheduling our purchase orders with vendors will help you find our way out of the chaos, and will take the edge off the holiday rush.

Do you need an Inventory Management System?

Meet one of our industry experts to see our product’s free live demo.

7 HUGE Benefits of Inventory Management Software

The global inventory software market is predicted to grow at a compound annual rate of 8.31% during the years 2016 to 2020. An inventory platform can help you to run your business in a smart and efficient manner. You can invest in a quality inventory management solution to streamline your processes and improve control over your business, or help choose a good alternative solution. Whatever your choice, in this article, we detail the top benefits of a good inventory solution for companies.

Save Money and Time

Automated inventory can help save you plenty of time, so that you can focus on your top-selling products and ensuring you stock them in sufficient quantities instead. Plus, inventory software saves you the administrative task of updating inventory, and you can utilize the time to expand and promote your business. Quality, cloud-based solutions allow you to access inventory data from anywhere, anytime. This facility can be used by your remote workforce as well as employees who need to access the system from home or in the field.

Setting Product Restock Levels

Ordering stock is a great example of a situation in which inventory management software can help. These software solutions have a preset order value feature that automatically dispatches a buy order to the supplier. Plus, they provide a reporting tool that can save you valuable time in determining your top products. Stock is the biggest asset for businesses, so it is important to forecast and streamline the supply of your popular products to improve sales via multiple channels.

Minimize Human Error

Growing businesses face the arduous task of dispatching the right products at the correct times to the precise locations. They also need to ensure that their products are high quality. There are chances for human errors while processing these orders because they need to delegated to particular warehouses and managed by multiple members in different teams.

Inventory software enables companies to streamline their warehouse processes because it collects and stores info in a centralized location. This enables administrators to effortlessly manage the goods stored in multiple places as well as by third-party partners. As a result, you can streamline the entire stock management process, improve delivery efficiency, and enhance customer satisfaction.

Keep Customers Updated

It is a tiresome and inefficient task to manually update your stock on all your sales channels. You will be spending a lot of valuable time updating your spreadsheets, especially if your product range is large. Manual management of inventory raises the risk of underselling and overselling products. For example, your customers will be disappointed if the product they order is not available immediately. Use inventory software to keep them informed by automatically updating stock status across all your sales channels.

Make Your Operations More Efficient and Productive

If you keep extra items in stock, you will tie up more money in inventory that can’t be spent. By efficiently managing your stock quantity levels, you can ensure your business stays cash flow positive. The inventory tool’s reports and analytics features can assist you to identify your fast-selling products on various sales channels. This enables you to make smart buying decisions. Additionally, you can also spot trends that you can capitalize on. A quality inventory system can also help you to manage product batches, expiry dates, multi-matrix item variants, and complex measurement units.

Minimize Costs and Maximize Profits

Top multi-channel e-commerce stores sell high volumes of products via their online and offline stores. They need to efficiently manage orders on all their sales channels and ensure they have adequate stock supplies to meet seasonal demand to minimize sales loss. Good inventory management is also important to reduce the costs of stock storage in warehouses. For example, profits can be impacted in many ways such as storage fees, deadstock, theft, taxes, insurance, and passing trends. You can minimize these costs by investing in a suitable inventory management software platform.

Integrate All Your Business Operations

After your sales rep issues a sales order, you can use inventory management software to fulfill the order. First, the solution’s user management tool allows you to create individual user accounts for each employee in different departments.

After creating job roles, you can assign role-based user permissions to ensure your employees get access only to relevant modules and features. This prevents them from accessing confidential reports and other important business data. Notes and tasks help team members to collaborate effortlessly. They can seamlessly share and transfer info on customers, products, invoices, suppliers, sales orders, and shipment deliveries. That way, the order fulfillment process is transparent.


You can keep track of the latest inventory management trends to effectively utilize inventory software. Read expert website directory software articles to select a suitable inventory program for your business needs. Use the free trial to understand if the inventory tool’s features fit your needs, and then upgrade to a paid package.