By: Kirti Acharya, Vice President – Product & Digital Engineering Services (PDES), Happiest Minds Technologies
In today’s fast-paced business environment, companies face constant pressure to innovate, streamline operations, and enhance customer satisfaction. One of the critical areas that often poses significant challenges is reverse logistics, particularly the Return Merchandise Authorisation (RMA) process. Managing returns efficiently while maintaining customer satisfaction and controlling costs is no small feat.
According to the industry data, the overall return rate in retail for 2023 was 14.5%, amounting to USD 743 billion in merchandise returns. Online purchases have an even higher return rate, at approximately 17.6%, compared to 10.02% for in-store purchases. These statistics underscore the complexity and cost implications of managing returns efficiently.
The financial impact of returns is significant, with processing costs consuming 20-30% of the product’s original price. Additionally, fraudulent returns account for 13.7% of all returns, costing retailers an estimated USD 101 billion in 2023. These figures highlight the pressing need for robust and efficient reverse logistics solutions.
Reverse logistics involves the flow of goods from customers back to the company, encompassing returns, repairs, refurbishment, and recycling. The RMA process is a subset of reverse logistics, where customers return products due to defects, dissatisfaction, or other reasons. Some of the key challenges are,
- High volume of returns: Retailers and manufacturers face a huge number of returns, especially with the rise of e-commerce. Sorting, inspecting, and processing these returns is time-intensive.
- Complex coordination: Coordinating between multiple stakeholders, including customers, 3PL providers, warehouses, and repair centers, can be daunting.
- High costs: The cost of handling returns, including shipping, restocking, and potential loss of product value, is significant.
- Customer satisfaction: Ensuring a smooth and quick return process is vital for maintaining customer trust and satisfaction.
- Compliance and environmental concerns: Companies need to dispose of or recycle products in a way that complies with environmental regulations. Keeping track of this manually is difficult.
How the ServiceNow app engine can help
ServiceNow App Engine is a powerful low-code platform that enables organisations to build custom applications quickly and efficiently. Here’s how it can address the challenges in the RMA processes.
- Streamlined workflows: The ServiceNow App Engine allows businesses to create automated workflows that streamline the entire RMA process. From the moment a return request is initiated, the system can automatically notify the customer with the RMA number, schedule the return shipping, and update the warehouse management application.
- Customisable applications: The platform’s low-code capability allows those with minimal coding experience to build applications tailored to specific business needs. This flexibility is crucial for adapting the RMA process to different product types and customer requirements.
- Integration capabilities: ServiceNow seamlessly integrates with existing ERP, CRM, Warehouse Management and supply chain systems, ensuring that all data related to returns is synchronised across the organisation. This integration reduces the chances of data discrepancies and improves overall process efficiency.
- Enhanced visibility: With real-time dashboards and reporting tools, the ServiceNow App Engine provides comprehensive visibility into the reverse logistics process. Managers can track the status of returns, identify bottlenecks, and make data-driven decisions to improve efficiency.
The role of now assist
Now Assist is an AI-driven tool that enhances the capabilities of the ServiceNow platform. When applied to reverse logistics and RMA processes, it offers several advantages.
- AI-powered insights: Now Assist leverages artificial intelligence to analyse return patterns, identify common issues, and suggest improvements. This proactive approach helps reduce return rates and enhance product quality.
- Automation of repetitive tasks: Now Assist can automate routine tasks such as data entry, return authorisation, and customer notifications. This reduces manual effort and speeds up the RMA process.
- Improved customer interaction: Now Assist can provide customers with real-time updates on the status of their returns, answer common queries, and offer personalised support through chatbots. This improves the overall customer experience and reduces the workload on customer service teams.
- Predictive analytics: By analysing historical data, Now Assist can predict future return trends and help in better inventory planning and resource allocation.
Building effective RMA solutions
For brands looking to streamline your Return Merchandise Authorisation (RMA) process, opting for tailored solutions on platforms such as ServiceNow can make a big difference. The ServiceNow App Engine offers the flexibility to design custom workflows that can be easily integrated with your current operations. These workflows can simplify the processes such as handling complex return policies, managing approvals, or sending customer notifications.
Integrating AI tools like Now Assist can significantly enhance the RMA experience, further simplifying processes. With AI-driven virtual agents automating routine tasks and offering real-time support, you can liberate your teams to focus on more strategic, value-adding activities. This ultimately leads to better customer experiences and also makes managing returns more effective and less time-consuming. However, the job doesn’t end with deployment. Continuous support and optimisation are essential. By regularly monitoring the system and incorporating feedback, you can ensure the process stays efficient and adapts as your business grows.
Looking ahead
While managing reverse logistics and the RMA process can present complexities and challenges, with the right tools, businesses can turn these obstacles into opportunities. Low-code platforms like the ServiceNow App Engine, coupled with AI-powered solutions such as Now Assist, offer a powerful combination for streamlining workflows, improving customer experiences, and making data-driven decisions. By automating tasks and enhancing visibility, these technologies can transform RMA from a time-consuming process into a seamless, efficient part of your operations.
As companies continue to navigate the evolving landscape of returns management, staying proactive with ongoing optimisation and leveraging innovative tools can ensure long-term success.
