on 24 January 2023 / 0

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When a package dispatched to the customer is not delivered and is shipped back to the seller, it leads to a logistical issue known as Return to Origin (RTO). Customers might feel empowered and facilitated when a product, which does not turn up to their liking, gets returned for replacement or a refund, but for the seller, it is a nightmare. With buyer preferences shifting online, the RTO ratio has increased considerably. Customers are three times more likely to return products sold online than in offline stores. If RTO in shipping is not addressed, it can affect the bottom line of a profitable operation. Let us first grasp why RTO is so critical in online trade.  Why RTO is important to an eCommerce business.

RTO plays a key role in logistics and helps better assess transport and warehousing requirements.

Return To Origin is an important component of pricing strategy and logistics to buffer against unexpected expenses. A seller will make a mistake by not including RTO in their costs. There is more to RTO in shipping than meets the eye. Here is why this component is so critical to logistics in eCommerce. 

  1. The Return on Investment (ROI) will not be accurate without Return to Origin. 
  2. The profit margin will erode with returns without RTO in shipping.  
  3. It is the key to estimating shipping charges for a product accurately. 
  4. Warehousing needs must include Return to Origin
  5. RTO is a critical component of logistics and helps mitigate risks. 

How sellers can bring down RTO in eCommerce 

Sellers can take various measures to regulate Return to Origin in eCommerce. Here are 9 quick steps to reduce RTO in shipping

1.Stringent quality control 

Quality products will always help retain customers. If the product has a manufacturing defect or shipping damage, a customer will return it.

There is no shortcut or alternative to quality in a product. Customers will return products that do not measure up to their claims or can’t match the specifications offered by the competition. 

2. Detailed product descriptions 

Educate the customer about the product better. Use better descriptions, AV slides and comparative carts to help them make informed decisions when selling online.

3. Transparent returns policy 

The returns in brick-and-mortar stores are around 9%, whereas, in online retailing, it averages around 30%. Why? Because the offline seller is transparent and approachable. That is why transparency in returns is always a good policy.   

Return to Origin is an important component of eCommerce. A seller needs to bring it down for competitive pricing and profitability.

4. Multiple time slots for delivery 

Spoil your customer with options. If the delivery partner and the logistics permit,  give multiple time slots to the customer to hand over the product. This will reduce non-delivery due to the unavailability of the customer significantly.    

5. Fast and reliable shipping with tracking updates 

If there are two products with the exact specifications, most customers will opt for the one with the fastest delivery. Good packaging and fast shipping reduce Return To Origin. Tracking updates keep a customer’s excitement levels high.  

6. Promote online payment with multiple choices 

According to a newspaper report, 1 out of every 3 deliveries in Cash on Delivery (COD) is returned. RTO in shipping goes up with COD because the customer has no obligation to complete the deal. Offer multiple payment gateways and rebates to customers who opt for pre-payment online. 

7. Update customer details and customer feedback and support 

A happy customer brings down RTO.

Customer feedback on a Non-Delivery Report is an important metric that can be used to assess manufacturers and resellers. It should be coupled with customer support to bring down RTO in shipping

8. Make pricing inclusive of the cost of reverse logistics 

Return to Origin can become a logistical nightmare in high-traffic seasons. The seller should make a smart pricing policy incorporating reverse logistics costs in case of a return. 

9. Flag repeat defaulters with an automated process 

Reduce your Return to Origin costs by flagging sellers and buyers who become habitual offenders. An automated system with intuitive AI can help sort out the bad apples, especially the resellers who compromise on quality and packaging. 

Key takeaways 

  1. There are two ways to bring down RTO in shipping. The customer-centric measures bring in qualitative enhancement to the product and its experience. The logistical measures such as RTO inclusive pricing bring down returns. 
  2. Last-mile delivery is more effective when the customer is given options in payment and time slots for accepting deliveries. 
  3. Your chances of delivery on a first-time attempt increase significantly with quality products and fast shipping.   

If you are looking for a reliable logistics partner for e-commerce, reach out to Ecom Express and avail technology-aided logistics support for reliable last-mile delivery. You can talk to our representative now at +91-8826398220 or write to us at salesgenie@ecomexpress.in


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