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A Dynamic Solution to the Downside of the Holidays – Returns

‘Tis the Season for Reverse Logistics

For most retailers, the big revenue season is now history and it’s time to deal with the aftereffects: Managing the huge volume of products returned by customers and the excess of leftover holiday inventory. Ultimately, most of these packages need to go back to vendors or get redistributed to other store locations or discount retailers for resale. But the first task at hand is to clear it out of the way and recover primary space for new inventory. Just managing the volume and storage of all of that transitory merchandise can be costly, complicated and time-consuming.

The speed, convenience and competitive practices of online retail have increased consumer expectations that all retailers will have the products they want to buy on-hand for the holidays and offer a hassle-free return policy. In addition, , so many retailers have to plan to keep more of those products on-hand longer. Often, this means an increase in inventory and a reduction in the ability to identify early holiday buying trends.

In addition, for many consumers and retailers, the week after Christmas has become much more than an opportunity to return or exchange unwanted gifts. According to a survey by the National Retail Federation, two-thirds (65.9%) of holiday shoppers said they were planning to shop after-Christmas sales. Nearly half (47.2%) of shoppers surveyed said they would shop at a store and 43.1 percent would shop online during that week.

These evolving trends can make it difficult to accurately plan for post-holiday storage of unsold inventory and returns. You don’t really know what you’re getting back, how much you’re getting back or how long it may need to be stored until after the holiday fog has cleared. And that’s when the problem falls squarely on the shoulders of warehouse and logistics management to solve.

A Warehousing Solution that Fits Post-Holiday Storage Needs Perfectly

In the past, you really had four standard solutions to consider: You could sell inventory fast in a heavily discounted “fire sale”, over-pack your existing warehouse(s), lease additional storage space or work with a 3PL (third-party logistics partner). Fire sales can work, but can also lower profits or result in losses. Nobody wants to jam huge amounts of holiday returns into warehouse space allocated to sellable inventory, and unfortunately, leasing additional warehouse space typically requires an unjustifiable long-term financial commitment and often forces you to pay for more capacity than you need. Working with a third-party logistics partner is a solid option, especially if they manage every aspect of reverse logistics on your behalf. However, going that route may not fit within your budget unless you contract for more outsourced services than you’re likely seeking.

When it comes to temporary post-holiday storage, On-Demand Warehousing is the most timely, flexible and cost-effective solution.

On-Demand warehousing is simple. Using an online service, organizations in need of additional warehouse space can connect with organizations that have extra space that meets their location, capacity and duration needs. For temporarily storing excess post-holiday volume, On-Demand Warehousing is the perfect solution. You can pop up a space when you need it, where you need it and for just the length of time you need it. There are no upfront costs or long-term lease commitments. You can grab the space you need within just a couple of days and you don’t have to pay for extra space or services that you don’t need.