International commerce, especially if done over the internet, is a great way to expand your business, find new customers and grow your revenue. However, there are some issues that you might find challenging. One of these is getting products to the customers and another is getting products back from the customer when they want to return them.
International returns are more challenging than domestic shipping:
There are tax and shipping laws to consider and the logistics involved in getting it back from the customer to your warehouse can seem almost impossible, at the very least international businesses struggle to avoid losses when returns are requested for international orders.
To combat these challenges you need a robust plan for international returns.
Here are our five key points to ensure that international returns are still profitable or at least don’t lead to a loss.
1. Should You Be Accepting The Return?
The first thing that should be considered is whether or not it is worth the cost to have the item returned in the first place.
If it is because of a faulty item, the wrong item was sent or that something was missing from the product – then you are obligated in most markets to accept the return.
When the customer has changed their mind, you aren’t always under obligation.
Therefore, you have to decide whether you should be accepting the return or not. If it is because the customer has changed their mind, you might need to discourage this with a surcharge.
2. How Much Will It Cost?
If there is nothing wrong with the product, then getting the product back to resell is probably the first thought on your mind.
Likewise, you probably want to check the product.
However, if the product’s profit margin is less than the cost to ship it back to you – then there is little point.
Perhaps asking the customer to dispose of the product themselves is the best option for your bottom line.
Alternatively, if you have a product with a high profit margin, getting that product back is probably the most important aspect.
3. Protection of The Product
When you want your product back for testing or to resell then you need to ensure that your product is protected from accidents during transit. Consider how you can do this when the customer has complete control over the wrapping.
You could ask the customer to use the same packaging and email them a new postage label or request that a courier attends the customer’s address to collect the parcel.
This increases the chance of being able to re-use the product and sell it again later.
4. Time Frame
Customers want to know how long it will take to get their refund (or replacement) but you are more than likely unwilling to provide this until you have received the original product.
Therefore, you will need to advise the customer of this.
Your logistics company or courier will likely have different pricing for different speeds but you will need to decide which speed is value for money and within an acceptable time frame.
5. Keeping The Customer Informed
Your customer will want to know exactly what stage their return is at, are you waiting for delivery of the product or are you processing the refund?
You don’t want to be inundated by disgruntled customers trying to ascertain where their refund is.
Whether you have an online tracking facility or an automated email system to keep customers informed is an important decision to make. Both have costs and interface with customers differently.
Products being returned from international clients, presents challenges for your business, so consider your plan carefully.
The five points above will help you produce a sound returns plan and ensure that customers know exactly what to expect from you.
- What is your international returns plan?
- Can you still make a profit from an international return?
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