You got lemons, you make lemonade, right? In wholesale distribution, a customer return is the equivalent of a lemon. You may have paid shipping, both ways. Now you have to unbook the sale, assess the items to make sure they can be returned to stock, and then process them back into inventory. Here's the formula for making lemonade when returns happen. It starts with having an ERP system with returns management functionality. It ends with stronger customer loyalty and actual sales increases.

Customers are a fickle lot. They'll only buy from distributors who let them pick and choose and allow them to return all or part of an order at any time, no questions asked. Well, long ago, a little department store in Seattle, eponymously named Nordstrom, discovered the letting customers return anything not only gave them the confidence to buy anything, it made them feel special, deserving of such pampering. That engendered intense loyalty. Works for wholesale distribution, too. To maintain long term customer relationships, your after sales service has to be as good as the upfront service. Every step of the process, and the alacrity with which it takes place, is an opportunity to wow customers. Or disappoint.

The returns management software in your ERP system€"and if you bought a system optimized for the distribution industry it almost certainly is in there€"can go a long way towards establishing proper processes to manage returns efficiently and cost effectively. Inefficient handling of returns can result in cash tied up in idle inventory, or even trigger automatic replenishment when not needed. Botch a return and customers start to wonder if you really value their business. They want to see credits show up in their accounts at the speed of light€"or electrons, at any rate.

An advanced returns management solution will help you process customer returns as well as supplier returns, including internal reverse logistics. It gives distributors the transparency and control to service returns made at the counter, shipped back to the warehouse or even returned to the vendor, and automatically updates all sales and financial records and processes the necessary logistics. Simply scan the shipping label and financial records are updated, a credit issued to the customer, a product inspection ordered and the warehouse system alerted that the returned items are pending release to inventory. That means sales people can know instantly that the products may be OK to promise within a narrow timeframe. With excellent visibility into the status of returns, staff can easily see where in the process chain a specific return is and monitor the physical location of the goods. More to the point, the entire process is so automated, nobody on the distributor payroll really needs to give much thought or effort to it.

A transparent, efficient returns process leads to increased levels of customer service. Your customers can see that your returns policies give them the flexibility they demand. That makes life easier for them and makes you more valuable to them. And the sooner they see that credit balance, the more likely they are to place additional orders, confident that if and when a return is necessary, you've got them covered.