Why Disposition is Important to E-commerce

Before I started working for myself as an independent writer and publisher, I wrote this blog for a potential employer as part of my job application. His business blog needed to publish content on a perpetual basis in order to stay on Google’s radar. Some of you business gurus know all about that.

After researching what the heck disposition for e-commerce was all about, I produced this article. Bearing in mind that the purpose of a business blog is to fish for customers who may not know the ins and outs of said business, this little blog entry serves as a great mediator for those virgins who are new to an entrepreneur’s game—I mean product and services. After all, a few days of research are incomparable to the years of experience and education of a seasoned CEO. Besides—and let’s be honest, the whole reason businesses invest in writers is to ensure that every piece of online content has the best possible chance of ranking on the first page of search engine results. Having said all that, I thought this article was pretty good, but I guess he didn’t like my face or something…maybe it was my hair, I don’t know…either way, I didn’t get the job.

The upside is that now I can basically write and publish anything I want, like say ‘virgin’, be snarky, and not have to worry about getting fired! Also, I throw nothing away, so here we are!

~Zorina Frey – Miami, Florida


Why Disposition is Important to E-commerce

Approximately 96% of Americans shop online. Fifty-eight percent of online shoppers will consider the return policy before making a purchase according to a Bizrate survey. If an e-commerce operation doesn’t have a satisfactory return policy with an efficient logistic system to support the service, it could be missing out on thousands of dollars of potential online sales. A disposition channel must be implemented in order for an e-commerce operation to thrive.

Disposition: How Vital is it for E-commerce?

A disposition channel will be unique for every e-commerce business according to the industry, the type of manufacturing role, and a string of other deciding factors. It’s also vital to look at the bigger picture. The overall objective is to move the product in a way that will not only meet the needs of the customer, but also provide the most generous ROI minimizing the expense of it all. When building and implementing a scalable disposition system, you have the opportunity to improve the profitability on returns as the business grows because when sales increase, so will the margin of returns.
According to Invespcro, 20% of consumers return products because of damaged goods, 22% will return a product because it didn’t look the same as it was portrayed online, 23% just received the wrong item, and 35% was because of other various reasons.

Here is the framework needed to build an effective reverse logistics disposition:

  • A clear and straightforward return policy
  • An organized returns preparation system
  • A streamlined receiving operation of inspection and sorting
  • A transport and exchange system for issuing a credit
  • Asset recovery

Understanding How Return Policies and Asset Recovery Work

Sixty percent of online shoppers are likely to provide repeat business based on the experience they had returning an item. A good return experience will gain a loyal customer.

In order to ensure a good return policy for Shopify returns and exchanges, your operation must involve protocols that will address establishing a contact for someone to authorize and arrange the return. The cost for returning the products and transporting them back to the vendor, the warehouse, a second-party seller, or elsewhere also needs to be established. Determining when and how the customer will receive his or her refund also needs to be taken into account as well as the time frame to execute.

The time frame and cost for such e-commerce logistics will all be determined by where the returned product will end up. It can be any one of the following:

  • Returned to back to stock
  • Sent back to the vendor due to damaged goods or overstocked inventory
  • Sourced to secondary markets like outlet stores or auctions
  • Sent to a recycling company or to a landfill

Position Your E-commerce Operation with the Best Possible Disposition

The reasons for returned items can vary. This is why your disposition methods need to be efficiently streamlined to ensure that the processes stay within budget. E-commerce warehouses and distribution centers need to have the most efficient inventory management system in order to process a variety of returns. The best way to achieve efficient fulfillment strategies is by managing all inventories through an omni-channel and a supply chain solution service.

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Feature photo by Craig Adderley

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