How Happy Returns’
customers save 21%
on returns costs
The business value of aggregating items
with in-person returns and online software
02
Executive summary
Retailers working with Happy Returns discover that they previously overspent
on returns and reverse logistics. To quantify the hard savings we deliver,
Happy Returns analyzed its customers’ return costs before and after using
Happy Returns’ solutions. Assessed costs included:
Carrier shipping fees
Per-item fees for in-person returns via Happy Returns’ Return Bar network
Returns software and/or Return Bar network subscription fees
Returns processing charges (if applicable)
Looking at the period February 2019 to February 2020, and including
customers with at least six months of data during that period, Happy Returns’
customers utilizing our returns software and Return Bars on average
saved 21%, compared to prior returns costs. Combined, the analysis
covered millions of items with an average of 1.85 items per return.
03
Table of contents
Executive summary
02
Research methodology
04
06
reverse logistics costs
10
11
12
Customer examples
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17
04
Research methodology
This ROI analysis compares retailers’ returns costs before and after they became
Happy Returns’ customers. This included some retailers using Happy Returns' entire
solution of returns software and in-person Return Bars, and another retailer set
that only uses its Return Bars.
To calculate each customer’s ROI, Happy Returns assessed the following costs:
Carrier shipping fees
prior to and after partnering with
Happy Returns.
In-person return shipping
fees
All retailers paid on a per-item basis for
use of Happy Returns’ network of over
700 Return Bars, where shoppers return
items in-person.
(continued on next page)
05
Research methodology (continued)
Returns software and
Return Bar network
subscription
Before partnering with Happy Returns,
some customers already used a
shoppers to initiate returns (and
sometimes exchanges) online. For
other customers, Happy Returns was
returns solution. The Return Bar
network subscription is an incremental
in-person return fees.
Returns processing
charges
Before working with Happy Returns,
retailers’ returned items were
processed at third-party logistics
providers. Some customers opted for
all items, both in-person and by-mail,
to be inspected and processed at
Happy Returns’ regional hubs.
Retailers provided their prior returns costs during our sales process.
06
21
%
19
Average savings when using
Happy Returns’ software and
Return Bars
Average savings for all
customers
These savings were achieved
in two primary ways...
%
07
Scenario A represents traditional returns, where items are individually sent back through the mail in
single-use cardboard. Scenario B represents items that are returned in-person to Return Bars, then
aggregated together in reusable totes.
Top contributors
Aggregation of items
Lower shipping rates
When shoppers bring returns to Return
Customers generally reduced shipping
Bars, items are placed inside reusable
costs with access to Happy Returns’
containers that hold up to ~20 items.
carrier rates, which are low due to
The containers are then shipped to
Happy Returns’ aggregated
Return Hubs and re-aggregated into
purchasing power.
being sent back.
08
Per-item costs
On average, retailers using Happy Returns’ full solution paid $5.02 per
item in shipping before becoming a customer. Retailers that only use
Happy Returns’ Return Bars spent $4.24 per item. After partnering with
Happy Returns, all customers averaged $1.98 per item when using
Return Bars—and if using our returns software, $3.69 per item for
returns by mail.
BEFORE AND AFTER
Retailers using Happy
Returns’ full solution
Retailers using Return
Bars only
Before Happy Returns
Returns by mail
Before Happy Returns
Return Bars
Return Bars
09
Retailers generate ROI in other ways that were not included in the
hard cost savings calculation:
from the increased exchange
rates and decreased refunds.
Both are attributable to the
industry’s only one-click
exchange feature.
due to fewer shopper calls with
returns and refund questions.
Less overhead, more
by managing only one vendor
for all reverse logistics needs
(if Happy Returns performs all
processing).
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Three drivers of expensive
reverse logistics costs
Traditional returns solutions are expensive due to:
Individual shipments
For retailers without stores, the only option
for returns is the mail, which traditionally
means shipping individual orders from the
customer back to the warehouse. Shipping
individual items is expensive, with no options
for consolidation to reduce costs.
Escalating carrier costs
Shipping costs have increased each year,
rising far faster than consumer prices. The
recent introduction of dimensional-weight
shipping has further increased returns-cost
pressure on retailers.
returns processing
Many retailers don't consider the total cost of
ownership when making a 3PL decision.
Returns processing is a real cost of
ownership in these relationships.
Furthermore, brands often have to make the
processing returns. Delayed returns
processing leads to unhappy customers and
drives expensive customer service calls
inquiring about the status of refunds.
11
How Happy Returns’ end-to-end
returns solution works
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5
4
3
2
1
2
1
Return in person
Return by mail
1
Shopper initiates the return online.
1
Shopper mails return.
2
Shopper visits the Return Bar.
2
3
Items are commingled in eco-friendly reusable tote.
Package uses low shipping rates from group buying
power across Happy Returns customers.
4
Robust technology inspects and processes items.
5
6
Totes are shipped back to the retailer.
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With Happy Returns Return Bars, shoppers drop
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Regional routing
Intelligent, automated routing to nearby hubs like Happy Returns’ regional
Blandon, PA
Van Nuys, CA
Intelligent processing
14
Customer examples
The following customer examples reveal how three anonymous Happy Returns
customers gained substantial savings.
A contemporary women’s clothing company previously
outsourced returns management to multiple third-party
logistics providers. By exchanging the piecemeal
approach for Happy Returns’ complete returns solution,
Company A saved 31%.
Per item shipping cost
Before Happy Returns
Returns by mail
Return Bars
(continued on next page)
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Customer examples (continued)
Prior to partnering with Happy Returns, a popular shoe
retailer worked with a competing returns solution that
shipped items back individually without processing them.
After switching to Happy Returns, Customer B saved 21%
on returns and reverse logistics costs.
Per item shipping cost
Before Happy Returns
Returns by mail
Return Bars
(continued on next page)
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Customer examples (continued)
A plus-size clothing retailer that manually processed
returns in-house before electing to use Happy Returns’
Return Bars. Customer C saved 35%.
Per item shipping cost
Returns by mail
Return Bars
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Conclusion
By eliminating expensive returns costs, retailers free up dollars to invest in
ecommerce adoption causes return volume to soar, along with the carrier
rates that accompany that volume. As the competitive retail landscape
important pillar for future growth.
For more information about how you can reduce the cost of returns, visit
Retailers.HappyReturns.com.