With e-commerce orders at an all-time high, so are the returns. To keep customers satisfied, retailers are offering free return labels for customers to drop the returned item off at a logistics company for the customers convenience. This keeps the customers happy with easy ordering and returning. Satisfied customers are often converted into dedicated shoppers.
The Problem
Sometimes, the free return label can cost the company more money than the actual item being returned.
The Solution
The solution? Reverse delivery services! But how do you start a reverse delivery program? With some logistical planning, along with some time to scale and educate the customer – you will have a well-oiled reverse delivery system that will save your company time and money.
Here are three areas retailers need to know about reverse delivery and how this affects them:
Logistical Planning
- Create a system that can identify when and where deliveries are happening. Correlate the deliveries with the return items.
- Coordinate route drop offs and pick ups based on location to cut down on fuel and time.
- Make a radius around brick and mortar stores and partner with independent contractors to pick up the return items and bring them into the store.
- Test with a small market area with high return rates.
Independent Contractors
- Utilize a 1099 independent contractor network to conduct reverse last-mile delivery. This will keep return logistics operating similar to the gig economy business model and cut down on W2 employee expenses.
- Partner with neighboring businesses who use an independent contractor network. This will incentivize the gig workers to be on multiple platforms in the same area and be able to earn more wages in a short period of time.
- Poll customers to find out how far they are willing to let independent contractors assist with the return delivery (leave at front door or schedule a return pick up window).
Liability
- Conduct detailed background checks on the workers to ensure theft and damage of returned items do not take place.
- Understand the risks of everything that goes with a reverse delivery order:
- Safety of the driver-partner
- Handling of goods (damaged or stolen)
Partner With A Gig Economy Expert
By partnering with a third-party administrator, your business can can better understand the gig economy and last-mile delivery sector. This can give your business the knowledge and experience your company needs to get ahead in reverse delivery. For over 25 years, DDI has been the leading third-party administrator that connects businesses with qualified independent contractors for last-mile deliveries. We provide full-service Human Resources and Driver Management solutions from onboarding, accounting, and risk management services for independent contractors. To learn more about what DDI can do for your business, contact our sales team to learn more.
