Returns management: from parcel on the bench to back on sale

Returns management is the part of a webshop that is easy to leave until later, because nothing visibly breaks when it is slow. A return is only finished when the item can be sold again or has been written off, and the customer has their money. Between the parcel arriving and that moment there are usually days in which nothing at all happens.

This page is for the person who receives returned parcels and has to do something with them: a webshop holding its own stock, from one person up to a team of a dozen. It is not written for sellers whose returns go to a fulfilment partner's address, and it does not cover the customer-facing side. The return label, the returns portal and which carrier collects are handled by your shipping platform, and a tool such as Sendcloud does that part well. This guide begins when the box lands on your bench.

First: when a shelf and a list are enough

If returns arrive in small numbers, get opened the same day, and nobody has to search for a parcel that a customer is chasing, you do not need anything beyond a dedicated shelf, a written list and someone who looks at it daily. That is a complete returns process and plenty of businesses run one.

The test is whether you can say, without walking anywhere, how many returned items are currently in the building waiting to be inspected. If that number is unknown, it is almost certainly larger than you would guess, and every item in it is stock you own and cannot sell.

The six steps

Arrival. The parcel is received and recognised as a return rather than a delivery from a supplier. These two flows should not share a bench.

Booking in. The return is matched to the order it came from and recorded. This is the step most often skipped, and skipping it is what turns a return into a lost parcel.

Inspection. Somebody opens it and establishes three things: which item it is, how many, and what condition it is in.

Decision. Back on sale, repair, discount channel, supplier claim or write-off. Each of these is a different destination and each needs a physical place to put the item.

Stock movement. The unit either returns to its fixed location and becomes available to sell again, or is written off so that your figures stop counting it.

Refund. The customer gets their money, within the period the law allows.

Those six steps are what returns processing means in practice. The order matters: a unit must not become available to sell before it has been inspected, because an unsellable item put back on the shelf will be sold to a second customer and come straight back.

Refunds: what the rules say

For goods bought online by a consumer in the United Kingdom, the governing rules are the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013. Three provisions matter to the person running the bench.

The cancellation window is 14 days. The customer may cancel up to the end of 14 days after the day the goods come into their physical possession. Where one order is delivered in several parcels on different days, the clock runs from the last of them. That is regulation 30.

The refund is due within 14 days. It must be made without undue delay and in any event within 14 days. Where you have not offered to collect the goods yourself, that period starts on the day you receive them back, or on the day the customer provides evidence of having sent them back, whichever happens first. That is regulation 34. The practical consequence is worth stating plainly: the clock can start before the parcel reaches you, on the strength of a proof of postage.

The customer bears the return carriage, but only if you said so. The default is that the consumer pays the direct cost of returning the goods. That default applies only where you gave them that information before the contract was made, as part of the pre-contract information the Regulations require. If you did not, the cost is yours. That is regulation 35.

Source: Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013.

Two things this does not cover. A faulty item is a different matter, governed by the Consumer Rights Act 2015 rather than by the cancellation right, and your obligations there are wider. And a marketplace may impose its own returns terms that are more generous than the law; selling on Amazon or eBay means accepting their policy as well as the statute.

What delay costs

The expensive part of a return is almost never the carriage. It is the two periods that run in parallel from the moment the parcel arrives.

The first is stock you own and cannot sell. A returned item awaiting inspection is capital sitting still, and in a seasonal range it is capital with an expiry date: a coat returned in late January and inspected in March has missed its season entirely.

The second is a refund the customer is waiting for. That one is measured in goodwill and in support tickets, and it is the reason customers ask twice.

As an illustration: an operation taking 40 returns a day that sit four days before inspection is holding 160 uninspected items at any moment. Halving the delay halves the holding. Nothing was bought to achieve that; somebody simply opened boxes sooner. The returns cost calculator will put your own numbers against that.

Returns management in the warehouse: what to set up

Four things, in order of how much difference they make for how little effort.

A returns bench that is not the goods-in bench. Returns and supplier deliveries have different questions attached to them, and mixing them means both get the wrong treatment.

A labelled place for each decision. Back on sale, repair, discount, claim, write-off. Five locations, each with a label. Without them, the decision is made and then the item sits in the same undifferentiated pile as everything else.

A rule about when inspection happens. Not an aspiration. A time of day, every day, and a named person. This single rule shortens both of the grey bars in the diagram above, and it costs nothing.

A record linking the return to the order. Whether that is a line in a spreadsheet or a record in a system, the requirement is the same: when a customer asks where their return is, the answer should be a lookup rather than a search.

For stock that carries a batch number — food, cosmetics, supplements — the batch has to be captured again at inspection, because a returned unit may not be from the batch the order was picked from, and putting it back under the wrong batch quietly corrupts both.

When a system starts to earn its place

A list on a shelf fails at the same point as any manual record: when two people need to use it at once, or when the answer has to be true now rather than at the end of the day. Beyond that, the signals are specific. Returns arrive faster than they are inspected, so the pile grows week on week. Customers chase refunds you believed had been made. The same item comes back twice because it went on sale uninspected. Or your returns rate differs sharply between products and nobody can say which ones, because the data was never recorded in a form you can count.

That last one is the quiet opportunity. A returns rate per product, recorded as a matter of routine, tells you which listing photographs are misleading and which size chart is wrong — and preventing a return is worth more than processing one efficiently.

Frequently asked questions

How quickly must I refund a cancelled order?

Without undue delay and in any event within 14 days. Where you have not offered to collect the goods, those 14 days run from the day you receive them back, or from the day the customer supplies evidence of having sent them, whichever is earlier. This is regulation 34 of the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013.

Who pays to return the goods?

By default the customer bears the direct cost of returning them, but only if you told them so in your pre-contract information. If you did not, the cost falls to you. That is regulation 35 of the same Regulations.

When should a returned item go back on sale?

Only after somebody has opened it, confirmed the item and its quantity, and judged its condition. Until that happens the unit is not stock, whatever the system says, and putting it back on sale before inspection is how an unsellable item gets sold twice.

What does a slow returns process actually cost?

Stock you cannot sell while it sits uninspected, a refund the customer is waiting for, and in seasonal ranges the risk that the item misses the window it was bought in. The carriage is rarely the expensive part.

Continue with

• Stock management for webshops — why an uninspected return is not stock
• Picking and shipping for webshops — the outbound half of the same process
• Peak season — returns arrive after the peak, not during it
• E-commerce — the wider picture for online retail

Two questions about your own operation

How many returned items are in your building right now waiting to be inspected?

Which three products have your highest returns rate, and do you know that from a record or from an impression?