Leading online marketplace automates returns to maximize recovery
In the wake of massive growth, this leading online marketplace for home remodeling and design sought a better solution for their ecommerce returns. They needed a platform that could help them make intelligent return routing decisions and achieve a higher net recovery for the returns. To achieve this, the retailer turned to Optoro for Returns Management and ReCommerce solutions. Leveraging Optoro’s managed services offering, the retailer’s returned goods now route directly from customers to Optoro’s facility, where the units are received, processed, assessed and resold on Optoro’s proprietary D2C and B2B resale channels.
For us, it was important to find a reverse logistics partner that is capable of both addressing a dynamic list of SKUs along with continuous disposition optimization to maximize recovery. Optoro provided easy to implement options for both.
Plagued by space constraints, manual processes and little recovery
On top of space constraints to receive and store returned goods, the retailer had a manual returns process. Half of returned goods were donated—in support of the company’s philanthropic efforts to turn houses into homes for people in need—while the other half were liquidated via a time-intensive process that recouped little value.
Driving over 90% unit resales and an impressive 150% increase in net recovery
Since partnering with Optoro, 91% of the retailer’s returns have been resold via Optoro’s proprietary resale channels. The program has increased net recovery(vs. cost) by more than 150%.
Furthermore, with a strong partnership, the Optoro teams and the retailer’s teams have been able to optimize the program over time. For example, through increased data availability and operational enhancements, the exception rate for returns has dropped by over 55% from year 1 to year 2. The retailer has seen a reduction in exception labor charges as a result of these improvements. The net recovery rate for the program also increased by 25% from year 1 to year 2.
Healthier profits achieved through data-driven strategic decisions
With Optoro’s unit and SKU-level performance data, the retailer now has a full picture of the profitability of their inventory mix, including the top- and bottom-line impact of returns. This data enables them to make better strategic decisions, including refining customer keep logic to reflect SKU-level profitability.
About the Customer
This online marketplace connects millions of homeowners, designers and home improvement professionals from around the world. Its website and mobile app serve as both an online marketplace for a curated set of furniture and home goods, as well as an inspiration board for interior design and home improvement. At its core, they are a tech company looking to drive towards smarter, data-driven decision-making across the board.