Skip to content

Considering Recommerce with its unheard-of gains

AMG Logistics

“Recommerce” or “reverse commerce” is the selling of previously owned, new or used products, mainly electronic devices or media such as books, through physical or online distribution channels to buyers who repair, if necessary, then reuse, recycle or resell them. – Wikipedia

Retail businesses are using recommerce to lessen their carbon impact and control the cost of returns as priorities for global trade and consumerism continue to change.

To extract value from current items and lessen the environmental effect of manufacturing and transportation, recommerce is a rapidly expanding business.

An estimated $100 billion is spent annually by businesses on cross-border returns. Presently, cross-border vendors have logistical, financial, and sustainability issues due to the up to 30% return rate on all online orders.

Since the returns phenomena is still relatively new, COVID has highlighted the shortcomings of the reverse logistics flow by not using returns as an opportunity. Brands in the past have attempted to execute at the lowest cost since they believed there was no money in returns, which generally results in giving the incorrect people the incorrect tools and producing inefficient targeting.

Ecommerce returns, especially cross-border e-commerce returns, are one of the most frequent causes of problem inventory. Recommerce offers advantages in the areas of business, the environment, and operations as compared to conventional ways of managing returns from online purchases.

Recommerce shortens the period spent managing returns, which improves cash flow. The traditional approach, in contrast, sees returns as a cost centre rather than a chance to generate income.

Utilizing domestic resale channels helps firms lower storage and shipping costs while reducing cross-border returns.

With a recommerce strategy that stresses two important components of sustainability—the lifespan of a product and the carbon footprint it leaves behind—brands can highlight their positive environmental effect. Products have more than one life and more than one customer thanks to recommerce. Some companies promote second-hand purchases in response to consumers’ increasing interest in sustainability.

Recommerce is now on the rise and will soon play a significant role in both the global supply chain and the retail industry.

Measurable financial benefits

Clear operational improvements are needed to overcome certain antiquated procedures as e-commerce and the global supply chain shift. Although consumers have been taught by retailers to anticipate quick and free delivery, there is no such thing as free.

Operationally, customer practices were based on the notion that problem stock was unprofitable and that brands didn’t care about it or comprehend it; it was referred to as a “rear-view mirror” issue. Lack of knowledge, a lack of data, and a lack of process are the foundations of the cross-border return process.

An efficient technique enables retailers to determine which high-value products are appropriate for resale and which things call for a cross-border return. For instance, in the fashion and garment industry, the best-selling shirts are flown back to the place of manufacture, while less expensive goods are either left behind or transferred to another market where they may be sold for less money.

Because of the information, it offers through a product grading system, a recommerce solution improves operational proficiency. Retailers can compare the process and results systematically, enabling improved business decision-making, thanks to the attribute maps that are provided to each item. These maps provide uniform data that can be utilized across multiple locations.

Share this post:

Share on linkedin
LinkedIn
Share on facebook
Facebook
Share on twitter
Twitter
Share on pinterest
Pinterest
Share on tumblr
Tumblr

AMG Logistics is a Lagos-based TRACE certified logistics company. Our services include Freight Forwarding, Customs Clearance, Trucking, Distribution, and Warehousing within Nigeria.

CONTACT US

 

Tel: +234 909 199 9866

sales.nigeria@amglogistics.com
+234 909 199 9866

customer.services@amglogistics.com
+234 909 199 9841

cs.abuja@amglogistics.com
+234 909 199 9805

documentation.department@amglogistics.com
+234 909 199 9813

AMG Logistics Locations

HEAD OFFICE
7c Creek Road
Apapa
Lagos

ABUJA BRANCH
B3 ground floor
84 Keane Nkrumah Street
Asokoro Business & Lifestyle centre
Abuja

PORT HARCOURT BRANCH
NAMA Admin Building
Port Harcourt International Airport
Omagwa
River State

LET US CONTACT YOU

CONTACT US NOW