Running a Consumer Packaged Goods (CPG) business comes with its fair share of challenges, and one such challenge is dealing with Return to Origin (RTO) orders. Recently, Apeksha Jain, Founder & CEO at The Gourmet Jar, took to LinkedIn to share a shocking experience involving a return order that left her astounded and frustrated. In her post, she revealed the absurdity of receiving a mere INR 5 Vim bar in a return, questioning whether it is the consumer or the courier company to blame for such occurrences. This incident highlights the financial burden and logistical hassles CPG businesses face when dealing with RTO orders, underscoring the pains involved in running a CPG enterprise.
Return to Origin (RTO) orders refer to cases where a customer’s order is returned to the seller instead of being successfully delivered. These returns can happen for various reasons, such as incorrect addresses, unavailability of the recipient, or the customer changing their mind. While RTO orders are an inevitable part of e-commerce and retail businesses, it is incidents like the one Jain faced that shed light on the challenges businesses face.
Speaking to Snackfax, Apeksha Jain, Founder of Gourmet Jar, said, “Logistic Aggregators need to come up with a process that ensures courier boys are not tampering with the packages. Automation might hold the key here. Perhaps something like a weight check of the package while it’s being returned to match the original weight might help reduce this problem. And definitely a better resolution from the aggregator’s end is much required, the time they take to get back and resolve issues like these is really way too long.”
The financial implications of RTO orders can be significant for CPG businesses. In Jain’s case, not only did she lose the revenue from the original order, but she also had to bear the costs of back and forth shipping. This double blow can have a detrimental impact on the profitability of small and medium-sized CPG businesses. The expenses incurred due to RTO orders eat into the company’s resources, affecting cash flow and hindering growth opportunities.
Consumer Responsibility vs. Courier Company Accountability:
When examining return orders, both consumers and courier companies share responsibility. While some consumers may exploit return policies to save money, it is crucial to consider the role of courier companies in ensuring reliable deliveries. Courier companies must handle reverse logistics efficiently to minimize the financial burden on businesses and prevent incidents such as the one Jain experienced.
Addressing the Challenges:
To mitigate the challenges faced by CPG businesses, all stakeholders must take proactive measures. Here are some potential solutions:
- Strengthen Return Policies: Businesses can review and refine their return policies to strike a balance between customer convenience and protecting their financial interests. Clear guidelines and restrictions can discourage frivolous returns.
- Improve Communication with Customers: Transparent communication regarding return policies and associated costs can manage customer expectations and reduce unnecessary return orders.
- Collaborate with Reliable Courier Companies: Developing strong partnerships with courier companies known for efficient reverse logistics can streamline the RTO process, minimizing costs for CPG businesses.
- Streamline Internal Operations: Evaluate internal processes and procedures related to returns. Identify areas for improvement and implement streamlined workflows to handle RTO orders more efficiently.
- Continuous Customer Feedback: Encourage customers to provide feedback on return experiences. Actively listen to their suggestions and incorporate them into the improvement process.
- Harness Technology: Implementing advanced tracking systems, automated return processes, and data analytics can provide valuable insights to optimize reverse logistics and identify patterns of misuse.
Apeksha Jain’s LinkedIn post highlights the harsh realities faced by CPG businesses during the RTO process. Assigning blame solely to consumers or courier companies is not productive; instead, all stakeholders must work together to alleviate the financial burden and streamline the return process. By implementing these strategies and addressing these challenges head-on, CPG businesses can improve profitability, enhance customer satisfaction, and streamline their operations in an increasingly competitive market.
