Note: Part I of a two-part interview, this Q&A was conducted in 2017. The follow-up interview, Part II, was conducted in 2020. You can find Part II here.
Returns are a critical part of the customer experience. A poorly run system can severely impact business, while a well-managed one can create loyal customers for life.
With today’s customers increasingly expecting products to be available on demand, the stakes are higher than ever.
Many companies have had to modify their operations to keep their customers happy, allowing them to shop wherever and whenever they want. Terry Bicycles, an apparel and bicycle-parts distributor from Vermont, is one such business.
We spoke to company CEO Liz Robert to learn how Terry Bicycles implemented certain strategies to improve the customer experience through returns, ultimately creating a quicker, more efficient system that benefits the company and its customers alike.
How have your customers’ shopping behaviors changed in the last 15 years?
Today’s customers are typically ordering online shortly before an event. Maybe they’re going on a group ride for the weekend.
The closer that they order to the date they need the product, the more critical it is that we’re able to respond if the product isn’t satisfactory. The on-demand nature of our consumer has inspired us to adopt an on-demand model as well.
How has the on-demand shopping model affected the apparel industry?
Because we sell technical athletic wear, it can be difficult for people to figure out sizing, particularly with new customers who aren’t familiar with our size charts. We have to be much more responsive in being able to get the product back and replacing it with the correct size.
So, it’s not just that the consumer is behaving in a more on-demand [manner] with their purchases; their expectations around returns and turnarounds in general are also much higher.
What’s been most impacted is the flow [of returns] and the fact that we need to respond quickly. I’ve been giving you the consumer’s perspective, because customer satisfaction is very important to us.
There is also a benefit to us—as a manufacturer and as a brand—to get returned product back as soon as possible, particularly when it’s on demand and we get deeper into the season.
Because our products are fashion-oriented, they are very seasonal. So, the prints that we create for Spring 2016 are different [from] the ones that we create for Spring 2017. It’s important for us to sell returned product again at full price and within the same season.
What challenges are you facing in this environment, and how is your company meeting them?
Mondays and Tuesdays are our biggest return days. They’re also our biggest selling days. We can’t afford to have staff both on the phone and processing returns to meet the high volume on those days, and then have them twiddling their thumbs for the last three days of the week.
In order to keep our workforce flexible, we cross-train our staff in the warehouse. Our process isn’t perfect, but we try to keep the flow under control without having to hire more people [on] certain days of the week.
So, if the phone’s not ringing, we can have employees in the calling center help with certain aspects of returns. And vice versa, there are certain employees involved in pick, pack and ship who can also be involved in the returns process—more specifically, putting the product back into inventory.
What tactics have you implemented to become more responsive?
Up until three or four years ago, we sent out returns information on the packing slip or invoice. It listed the returns department and our address. We posted it on our website, catalog and customer service notes.
Now, we send out a return label, so customers don’t have to go to the website [to] find out the return address or take [the return package] to a Post Office™ location.
They can simply put that label on the same packaging their order arrived in. From the consumer’s perspective, this takes many steps out of the return process.
How has including a return label in your shipments changed the process for your customers?
Honestly, they prefer it. I would say the majority of our consumers use the preprinted label, even though it costs them a few dollars more. (We include a small handling fee for arranging and processing.)
Because of the convenience and the speed at which they’ll be credited for the return, they choose to use the label provided. It’s all about convenience and expediency.
We also allow them the option of making the return themselves. This way, if the customer wants to handle the return [with USPS] and not pay the handling fee, they can. It takes the pressure off, and I think that’s very important to them.
What is one thing that surprised you about this new system?
The biggest skepticism I had in doing this was whether people would pay more for the convenience of the label.
We were extremely surprised that most of our customers now use that label to return the product. It taught us a lesson on the value of convenient service. People will pay for it. That, to me, was a big breakthrough.
Every company must find ways to efficiently handle returns, and pain points will differ from company to company and industry to industry. For Terry Bicycles, offering multiple return options, tweaking warehouse processes and cross-training employees all helped bring their business into the future.
As you continue to adapt to shifting consumer expectations, you can reference the points above to create a system that works for you.
To see how Terry Bicycles has adapted to a changing market since this piece was published, check out Part Two of this interview here.