In case the shopping or exchange policy is not appropriate, it becomes difficult to retain the potential customers. Reverse logistics services usually permit customers of high-return categories and businesses and allow them the margin that they can send returns into the pipeline that are nearest to their location, either at home or via a retail outlet. The reverse logistics provider should consider introducing an offer system that serves visibility if goods are being returned in advance of receipt in the retailer’s distribution center. This will assist the merchant in scheduling resources accordingly alongside giving the merchant an estimate of return goods that will be feasible to fill additional orders of customers. Often, some retailers also initiate the credit or refund process once they receive customer returns.
However, cutting down the receiving of several weeks off may help to protect some of the back-order costs and it also reduces the threat of customer loss. This creates a possible problem with global sourcing lies. It is difficult for direct marketers to place the order again other than in large quantities. As the purchases requirement is usually minimal, receipts are not prepared in numerous shipments.
Inbound logistics
Managing on-time and in-stock position is necessary with direct promotions and advertised the retail product. If a reliable source of merchandise is not available, there are chances that potential sales could be lost. The product needs to get quickly and safely into the logistics pipeline as it is challenging to project sales.
Suppose the product is damaged via inbound transportation. In that case, there will be a shortage of product availability which in turn will cause profits to decline because of the loss of potential sales. Initiate by following the coming inbound, that is the location and time of delivery.
Then come the import and the arrangement of containers priority wise because air freight is expensive and may surpass the limit of low priced products.
Reverse Logistics
It is to note that direct channels follow the FTC’s 30/60 day rule: If there is a possible delay in receiving, direct marketers are bound to inform customers about this, which sometimes leads to the cancellation of the order completely.
Additionally, in the environment of multichannel retailing, warehouses are acting as the “back room” for specialty store operations. If the product cannot be moved quickly into a retail outlet, potential sales could be missed.
In order to meet sales goals, transportation has now become even more significant since the companies are becoming leaner.
Also, merchandising stores and catalog promotions are different from one another. In indirect promotions, the customer is negative toward substitution, but in retailing, customers do buy substitute products from what they initially intend to buy.
This is why many catalogs accept charge-backs for late delivery, back orders incurred and substituted product.
Outbound logistics
Sales of IKEA can be seriously affected if the expectations of customers are not met due to the logistics of delivering to the customer. For example, if the delivery of a gift is late or if the products is damaged or is of poor appearance at the time of arrival. If the customer is not happy with the product, cost of operation is increased because of return.
On the contrary, logistics can influence a company’s marketing plan provided that the transportation costs are under control.
According to a recent research, 79 percent of e-commerce companies planned to offer free shipping and handling. L.L. Bean offered free shipping on all orders for the very first time in three holiday seasons. Free shipping has proved to be very helpful for increasing sales and average orders.
If the transportation costs of the company are not in control, there will be fewer offers for shipping promotions.
