In today's booming retail economy, consumers expect retailers to go the extra mile to give them good customer service. Flexible returns are no longer seen as a perk when buying online, but rather a necessity. If your business doesn't offer flexible returns, you could be missing out on online sales.
Almost half of all consumers, 48 percent, say that a flexible returns policy is one their top reason for choosing to buy from a particular retailer. This percentage was higher in 2016 than it has been at any time in the past. It's clear that businesses that don't offer flexible returns to their buyers could be a risk of losing customers.
Consumers love flexible returns, but they come at a cost for businesses. In 2016, big-box retailers spent $260 million on returns, which is an increase of almost two thirds compared to figures collected six years earlier. For many small businesses, the costs of a flexible returns policy can seem insurmountable.
The burden of handling customer returns peaks at particular times of year, which makes this logistical challenge even greater. More than 20 percent of returns occur during the holiday season, particularly during January when consumers return their unwanted holiday gifts or exchange them for something more suitable.
Despite the difficulties associated with a flexible returns policy, modern businesses in many industries can't afford not to have one. Having this policy can boost consumer spending by an astonishing amount. In one study, a retailer that began offering free returns experienced a 357 percent increase in consumer spending. Therefore, free returns could pay for themselves by making customers more likely to buy.
Flexible returns can have long-term benefits. Today's consumers value good customer service and are more likely to remain loyal to brands that treat them well. As the cost of attracting a new customer can be much higher than that of selling to an existing customer, loyalty should be a high priority for all businesses.
To cope with the challenges presented by a flexible returns policy, small businesses need to plan ahead to cope with spikes in returns that normally occur just after major holidays. They must also ensure the return process is as efficient as possible. Consumers should not have to jump through hoops to return an item that is unsuitable or unwanted. Instead, they should simply be able to place the item into a prepaid package and send it through the mail to the retailer.
Offering free and flexible returns can improve your relationships with your customers and boost your overall reputation. By taking steps to ensure your business can meet the financial and logistical challenges posed by flexible returns, you can improve your chance of success in the future.
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