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Written by Yitz Lieblich

How Your Order Management System Handles Returns

With the influx of returned packages coming into retailers at such a rapid rate, accurate inventory counts are crucial to online retailers.

UPS expects to deliver a record 5.8 million returned packages during the first week of January and 1.3 million returns on Jan. 5, a day in which the package-delivery company has named “National Returns Day.” This is up from 1 million returned packages on National Return Day 2016. So, what does this mean for online retail?

With the influx of returned packages coming into retailers at such a rapid rate, accurate inventory counts are crucial to online retailers. A flood of inventory coming back into the warehouse may mean that retailers have to discard damaged goods, discount overstocks, and make sure that former out-of-stock product pages are brought back online. For companies with brick-and-mortar operations, many online-purchased products are returned in-store. With all of these complexities happening in such a short period of time, making sure you have an order management system that has the following checklist of features is crucial to success in the first quarter.

Real-time Inventory Management

Up-to-the-minute accurate inventory counts are imperative to avoid sitting on large amounts of overstocked items due to returns. The first quarter is traditionally the season of discounting unsold holiday merchandise – and with the market saturated with sales – moving these items out of your stock quickly is essential to saving sales margin. In a less common case, popular items that were sold out may have a few more back-in-stock after returns, and that is a selling point to make to the customer as quickly as possible.

Look for inventory management systems that have automated processes for counting inventory and automatically send out low-stock and out-of-stock alerts for every item in a product catalog. Managing and moving January returns inventory will make for more efficient buying planning for the coming months.

Synchronized Orders

Synchronizing orders across all sales channels will help consolidate shipping costs and manage where your inventory is and how to move it efficiently. With products coming in from multiple shipping companies, through multiple warehouses, and to physical store locations – knowing where your inventory is, and where it needs to go, is vital.

An order management system that has capabilities to fulfill orders from any warehouse location is standard in the industry, but having an OMS that can fulfill from in-store locations can eliminate the cost of shipping returned stock back to the warehouse. Fulfillment from brick-and-mortar locations also means that stock can be shown as available instantly, decreasing the need for discounting to move overstocked return merchandise.

See how SkuNexus enables fulfillment from any physical store location.

Vendor Management

Many online retailers do not source from just one warehouse. Drop-shipping from multiple vendors, and shipments from multiple warehouses are the new norm. Having an order management system that lets vendors see returns coming in is necessary to keep customer service running smoothly. If there is a problem with a drop-ship product, vendor communication is key to receiving more stock, and eliminating bog downs on your customer service line because of replacements needed for drop-ship products. An OMS that has vendor dashboards and portals eliminates disparate communications and streamlines workflow for re-orders and returns.

These advanced features should be native to the order management system you choose to keep the holiday season, and subsequent return season, from hurting the bottom line. 

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