The Complexities of Apparel Fulfillment
The apparel industry is fast paced, which makes apparel fulfillment a challenging task. Apparel supply chains must be agile and adaptable to the following:
- Bracket buying: This is when the customer orders multiple sizes or colors of an item to try on at home and return the ones that don’t fit, or they don’t like.
- Seasonal fluctuations in demand: Apparel demand typically peaks during the holiday season and during other seasonal events, such as back-to-school which directly impacts inventory levels. This can strain supply chains, as businesses need to quickly ramp up production and fulfillment to meet customer demand.
- Value-added services: Customers increasingly expect businesses to offer value-added services, such as free shipping and returns when they order an item. These services can add complexity to the fulfillment process and increase costs.
- Returns: Online returns are more common than brick-and-mortar returns. The average return rate for online purchases is 18.1%, while the average return rate for brick-and-mortar purchases is 8-10%. This is because it is more difficult for customers to try on or assess products before they order them online.
In addition to these challenges, apparel fulfillment also adds another layer of complexity to the fashion industry: the need to deliver orders quickly. Customers expect their orders to be delivered within a few days, and they are often willing to pay a premium for this convenience. This puts pressure on businesses to find ways to improve their fulfillment and returns processes. Kasia Wenker, Director of Supply Chain Solutions at ITS Logistics, gives her insights on the complexities of apparel fulfillment and why you should encourage returns.
Returns: The Nightmare of Apparel
Due to the various options in the fashion industry, consumers have started bracket buying. People buy multiple sizes, colors, and styles of the same item with the intention of returning the ones they do not want. This causes an influx of returns and off sets inventory levels. Most companies don’t want returns, but Wenker emphasizes that companies should not take this stance. Allowing the customer to try various sizes and colors increases an opportunity for sales. In turn putting different options right into consumer hands. Returns are an inevitable aspect of the apparel fulfillment industry. It is important to not shy away from them and even encourage them. Considering this, Wenker proposes two valuable approaches to returns:
- Return money as soon as possible. It helps to retain customers. If a customer must wait a long time to get their money back, they may be less likely to shop with that apparel company again. Also, it helps to reduce the risk of fraud. If a customer knows that they can get their money back quickly, they are less likely to try to return a product that they never actually bought. This overall helps with the customer experience.
- Efficiently processing returns to make products available for resale ASAP. It helps to reduce the amount of time that products spend in the returns process. The longer a product spends in the returns process, the more likely it is to be damaged or lost. Also, it helps to get products back on the shelves as quickly as possible, so that they can be sold and meet customer demand.
Adopting these approaches not only addresses the challenges of returns but also contributes to fostering customer loyalty and improving the overall shopping experience. By embracing returns and optimizing the associated processes, companies can harness their potential to enhance customer satisfaction and drive business growth. In addition, companies can use data from returns to improve their product offerings and marketing campaigns. This is because returns data can provide valuable insights into what products customers are interested in, what products they are not, and why they are returning items. This data can be used to optimize product assortment, pricing, marketing, and the product lifecycle, and to better understand fashion trends.
Consequences of Returns
Encouraging returns requires a streamlined approach for managing them effectively. One solution involves utilizing a specialized return solution that centralizes the process. “For instance, items are sent to specific hubs like our Indy locations, then consolidated and directed to a central returns center.” says Wenker.
This approach minimizes shipping costs by receiving bulk shipments from these hubs instead of individual packages. To enhance efficiency, an internal process within the returns center becomes crucial. This internal process ensures a swift return of items to stock, maintaining a smooth inventory flow. Companies should prioritize partners that offer speed and adaptability when selecting a distribution and fulfillment center for internal returns processes.
Another aspect of returns is refurbishment of apparel. Clothing returned to the distribution and fulfillment centers often shows signs of use or wear. To reset the product, value-added services are essential. Wenker highlights the process, which includes tasks such as ironing, steaming, folding, and pinning. Attention to detail is particularly crucial for shoes, including cleaning the soles to maintain their original appearance. Returns may sound like a hassle, but they are crucial in a successful apparel business. Wenker further encourages customers to explore a range of choices and embracing returns for items that don’t resonate.
“Consider StitchFix: they deliver the item to your door, boosting the chance of purchase. Trying it on physically increases the likelihood of keeping it. Supporting returns for various options is useful – customers can buy different styles, sizes, and colors, then return what doesn’t work for them. This also encourages customers to keep more items than they had originally intended to.”
In the dynamic realm of retail, flexibility is vital. Embracing a customer-centric returns management approach fosters loyalty and business growth. Efficient returns processing and careful refurbishment of products can lead to customer satisfaction. This creates a seamless connection between your optimized supply chain and the needs of your customers.
ITS Logistics: The Trusted Partner for Seamless Apparel Fulfillment
Choosing ITS Logistics means partnering with experts in apparel fulfillment. ITS understands the challenges in apparel fulfillment, including trends and returns. They tailor strategies for effective management, embracing returns, and enhancing customer relations. With a dedicated focus on optimizing efficiency ITS is your trusted partner for seamless apparel fulfillment solutions.