Retailers could save £200m a year simply by managing returned goods more efficiently, a new report from the Institute of Logistics and Transport, Sheffield Hallam University and Cranfield School of Management says.
Overstocking, poor accountability and supply chains engineered to push products forwards, but not backwards, were largely to blame for the waste, said the Royal Mail Group, which commissioned the research.
Although all of the leading supermarkets had set up returns mechanisms in recent years, especially as they developed their non-food offer, there was still a lot of work to do, said Wincanton business sector general manager Larry Boulton.
“The key is treating returned goods as products with a value, not as waste. The Waste Electrical and Electronic Equipment Directive, for example, is about optimisation: reuse, resale, reducing and recycling. TVs will soon be classified as toxic. By setting up an efficient reverse logistics system, the same TV could earn retailers £10 instead of costing them £10 if the correct dispositioning routes are established.”