UPS unveils new online returns solution

[September 19th 2000]

E-commerce experts agree: If there's a fly in the online ointment, it's handling and processing returns from customers. UPS - the shipper of more than half the purchases made over the Internet - has unveiled a remedy that simplifies back-office functions for business while making the process for consumers as simple as "log on, print, log off."

The new service is designed to provide consumers with an on-screen label that can be printed on standard paper directly from their PC, complete with a list of nearby UPS drop-off locations, as well as colour maps to those locations. Alternatively, UPS return packages can be handed directly to one of UPS's 70,000 drivers. Once shipped, shoppers can then track packages directly from the merchant's site or from UPS's site.

To activate the returns process, a customer requests a return on the merchant's Web site. The merchant's system then processes the return request according to its business rules. Based on the merchant's return policy, an electronic request is sent as an XML document to UPS systems, which respond with the appropriate label. This shipping label appears instantly on the customer's monitor along with instructions and a link to addresses and maps to UPS drop-off locations.

The return shipping label can then be printed on the customer's PC printer on a regular 8 1/2 X 11 sheet of white paper. The system also allows a customer service representative to e-mail the customer a URL that provides the online shipping label. This entire process takes about four minutes.

The merchant electronically receives information on what is being returned, when, and for what reason, allowing it to manage the shipment more efficiently. For example, if a customer returns a CD player because he "changed his mind," the system will ship it back to the merchant for re-stocking. If it is being returned because it's defective, the system knows immediately which manufacturer to put on the return label so it can be returned under warranty.

When the merchant receives the package, transportation charges are billed and the customer's account or credit card can be credited for the returned merchandise.

Merchants are billed a transaction fee for each return in addition to transportation charges, which are billed once the merchant receives the returned package. UPS said it is accepting a limited number of customers through the end of the year as the service is ramping up. UPS will begin offering the service on a broader basis during the first quarter of 2001.

Internet superstore buy.com has been piloting the new service since June on its e-commerce portal that links the stores at www.buy.com. Now buy.com provides its customers with labels that print in seconds, whereas traditional returns services can leave customers waiting for labels anywhere from five to seven days.

The new UPS service also reduced buy.com's incoming returns calls by 40 percent - a clear indication that their customers prefer using the Internet rather than the telephone.

"At buy.com we're focused on providing our customers with superior online service throughout the purchase lifecycle - even when the cycle includes a return," said Tom Wright, buy.com vice president of operations. "UPS's Web returns program has helped us increase customer satisfaction at the same time we're reducing our returns costs and improving our inventory management."

The technology is an automated, browser-based, self-service solution that integrates the company's back-end databases into the online returns process. For consumers, this provides online label printing, but even more significant is that it helps online businesses - even those routing returns back to multiple suppliers - precisely manage their returns process, and analyse returns data for customer behaviour and logistics trends. It literally makes the information surrounding the returns process as valuable as the product itself. Here's how:

• Inbound Package Information: Vital package information enables precise inventory management. UPS provides the who, what, when and where of returns - who's returning it, what's being returned, when it will arrive and where it's going, which is perfect for companies with multiple suppliers.

• UPS Smart Label: Package information contained on the UPS shipping label is linked with the tracking number to facilitate internal returns automation. This label has three information fields: two for reference order numbers and another for a Returns Merchandise Authorization (RMA) number.

• Customisable E-mail: This allows the merchant to send a customized message to consumers, vendors, manufacturers or a returns depot. For instance, Customer Service can e-mail a label with a specific message to customers, or they can use this feature to alert the consumer when a return has been received. The merchant can also use the feature to alert manufacturers of incoming defective products that are covered by warranty.

• Delivery triggers charges: Shipping charges occur when returned goods are actually received, which also can trigger customer credit. Some other returns solutions require pre-payment (pre-paid postage), tying up valuable cash.

• Customer Tracking: Customers also have package visibility with 24/7, real-time information on the status of their return, which improves customer service and reduces costly person-to-person call centre queries.

• Multiple Destination Routing: This is critical for those companies using multiple suppliers, or Web portals that aggregate numerous sellers. The feature also enables merchants to route certain products to specified stocking locations for disposal or liquidation, or warranty items to original manufacturers. This feature also reduces transportation costs because packages are returned to the right vendor location on the first shipment. -

• Proactive UPS Service Locator: Users receive a URL, which when clicked, provides lists, directions and even maps to the nearest UPS drop-off location.

• Adaptability: The product is adaptable to all sets of unique business rules, allowing the merchant to retain control of its return policies. This enables the merchant's site to either accept or decline both transportation and product charges, based on the reason for the individual return, e.g., buyer's remorse.

• ASP Structure: Because UPS online returns service is hosted by a third party ASP, businesses can enjoy the benefits of complex technology without undergoing the hassle and expense of an extensive IT implementation.

• Delivery Service Flexibility: The service enables businesses to choose from guaranteed UPS Ground, Next Day Air, 2nd Day Air or 3 Day Select services.

Links
UPS		http://www.ups.com