UPS adds exchange option for high-value returns

UPS adds exchange option for high-value returns    Integrated logistics provider UPS said Monday it will launch a reverse logistics service in the fall aimed at helping businesses with high-value products save money and improve customer service when handling returns or exchanges.
   The service, called UPS Returns Exchange, is different than typical return programs in that a consumer will immediately receive a replacement item from the UPS driver picking up a defective or unwanted product instead of sending the product back to the manufacturer and waiting for a new or repaired item to be redelivered.
   UPS considers electronics, health care and retail companies as potential prime users of the premium service.
   Atlanta-based UPS already offers several types of products for managing and delivering returned items. But third-party logistics providers 'need to have a differentiated approach to reverse logistics because there are so many different types of products being returned for different reasons,' said Shumeet Shroff, UPS's director of new product development, in a phone interview from Los Angeles where he was attending a supply chain industry conference.
   Returns cost businesses lots of money in handling, transportation, repairs and disposal. Last year U.S. consumers returned $200 billion worth of goods, according to reverse logistics and aftermarket services consulting firm Greve-Davis. Manufacturers spend 9 percent to 14 percent of sales on returns, but only 20 percent of goods returned are actually defective.
   Companies with strict returns policies or poor returns processes risk losing customers dissatisfied with their shopping experience.
   UPS Returns Exchange is designed to address many of those issues. The driver will assist the customer in packing the return item in the box used for replacement, which comes with resealable tape. The service reduces packaging and delivery costs by eliminating the seller's need to send an empty box to customers and then dispatch UPS a second time to retrieve the item, saving fuel and carbon dioxide emissions.
   Giving the UPS driver more responsibility for preparing the return reduces risk for the shipper by ensuring that the package is sent to the right destination and by the right transport mode, as well as that it is properly packaged to reduce damage during shipping, Shroff said.
   It can also cut down on fraud, he added, by verifying that the original item is sent so that a consumer can't falsely stuff an unrelated substitute in the box and then blame the carrier for the mistake.
   Shroff said immediately swapping an item at the consumer's premises also helps businesses quickly turn over their stock of refurbished goods. A laptop under return, for example, may only have a minor software or configuration problem that is easily fixed. Fast refurbishment means the manufacturer doesn't run the risk of obsolescence and can extract as much value as possible through resale.
   The product exchange also is more convenient for consumers who otherwise would have to pay a second time and then get a credit if they want a new item right away, he explained.
   UPS makes the entire transaction visible to both parties by linking the tracking numbers of both the outbound and return shipments. Consumers who call the manufacturer's customer service center or go online, as well as manufacturers, can get a shipment update simply entering one of the numbers.
   The logistics provider has been testing the new service with several customers in Europe and will roll it out to the rest of Europe, North America and Puerto Rico in October, Shroff said.
   UPS offers several types of returns services. Through its Service Parts and Return product the company manages parts return, and then diagnoses, fixes or disposes of the parts. It also provides outsourced repairs of laptops and other products at its package delivery hub in Louisville, Ky.
   The regular returns fulfillment product includes options for the customer to produce printed labels for outbound shipment or post a link on the company's Web site, or have UPS mail or e-mail a return label to the customer.
   UPS Returns Plus provides one attempt for door-to-door returns pick up. If unable to pick up the package, the driver will leave the label for the customer, who can take the package to any UPS dropoff location or authorized shipping outlet.
   UPS also allows businesses to automate by enabling customers to make return requests from their company website.
   Last year, the company introduced UPS Returns Flexible Access, which allows customers to put smaller size items in their mailbox or take the package to any UPS or U.S. Postal Service outlet using the same UPS label.
   'Reverse logistics is not one silver bullet. You need to have an arsenal of services to address needs within your business,' Shroff said. ' Eric Kulisch