The Fundamental Pillars of An Effective Returns Management System

The Fundamental Pillars of An Effective Returns Management System

For a long time, companies have always placed returns management operations under subsidiary part of existing logistics functions where these processes get little to no attention. This action has a direct impact on the company’s customer satisfaction levels, supply chain efficiency, and brand value. As an important part of order fulfilment cycle, returns management ought to be taken a little more seriously because if done right, the reverse logistics or return management operations can increase the level of customer service and lower the cost of doing business.

A cost-effective returns management process will connect the incoming supply of returns with the demand for re-captured raw goods or repairable items and product information. This will help your business improve delivery and increases profitability. Here are key pillars of an effective reverse logistics program.


When it comes to returns, it is hard to synchronize material movement in the supply chain. If you are a manufacturer, paying close attention to reconciliation and receipts is a must. Also, stakeholders must always be notified of impending issues in good time. Reconciliation leads to company-wide control and visibility.

Quality assurance, reconciliation and final disposition, and regulatory compliance are the three control aspects to improve the return management process. Work to identify quality control issues via processes such as product engineering. Make sure that you provide timely feedback to help your team address the cause of the problem. More information at


A company must work to obtain visibility in its returns management process via bar-code identifiers, carrier integration, and web-based portals. Try to capture the information early in the process to improve predictability and visibility. Barcode identifiers will provide accuracy in inbound shipment information which includes dates, quantity, condition, and parts.

This will ensure that the repair depot, as well as the receiving dock, are well prepared — labor and equipment — to deal with the returns. Use automated notifications and web-based portals to increase shipment visibility. The integration of web-based portals with product information ensures accuracy and consistency of data shared across the diverse set of third-party providers, business units, and manufacturing locations.


Decisions on how to process return materials and whether to generate RMA (Return Material Authorization) should be automated to achieve fast and easy returns management. The system should have user profiles to simplify permissions and maintenance. Information such as product return eligibility, service contracts, payment terms, and physical locations can be shared via user groups.

Attachments and labels can be used to increase predictability. Carrier compliant labels and pre-addressed paperwork cause fewer delays, relatively. Automating workflows drive consistent routing and repeatable processes which increases speed and efficiency. All the above factors — control, visibility, and speed — combined, will lead to a more effective returns management process. Although return material authorization will involve physical products in the contemporary business set up, the process is totally different when it comes to IT. Here, the transaction involves a unique software license as opposed to physical products.


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