Many Happy Returns

Outsourcing Returns

Many netpreneurs, not wanting to handle the returns process themselves, turn instead to returns management solutions (RMS) companies for help. RMS companies handle all aspects of returns management for you. They can generate shipping labels and return authorizations, which include information about why customers are returning the products, what they're returning and other pertinent information. They may also take care of the physical handling and disposition of those returns. Sometimes, these companies even have returns facilities, where employees scan, open, verify and assess the condition of the returned products.

Many RMS companies integrate their systems with yours, so your order management, credit processing, transportation, returns authorization generation and customer service systems are all connected. This way, you can track the status and condition of returned products, and items can be routed to the locations you designate.

Many RMS companies also allow your customers to return products to USPS offices or other carriers' offices, where they're shipped back to you. They also give your customers instant credit for returns. RMS companies usually charge an installation fee, starting at $10,000, and a transaction fee for each returned package-anywhere from 50 cents to $4, depending on the level of service offered.

One such company is Newgistics Inc.. With Newgistics' Return-Valet service, you can offer your customers the ability to return merchandise to local neighborhood parcel centers and receive instant credit on the returned goods. You can also have packages shipped in bulk to a regional returns facility, which can help to substantially lower your costs associated with returns. Another com-pany to check out is, which lets you offer your customers a returns process through 3,400 Mail Boxes Etc. locations nationwide or the USPS.

Whether you decide to process returns yourself or hand the responsibility over to an outside firm, remember that satisfied customers are the only ones who will return to your Web site for purchases in the future. And having just served a ton of brand-new customers this past holiday season, can you really afford to lose them?

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Melissa Campanelli is a technology writer in Brooklyn, New York, who has covered technology for Mobile Computing & Communications and Sales & Marketing Management magazines. You can reach her at

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This article was originally published in the January 2001 print edition of Entrepreneur with the headline: Many Happy Returns.

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