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Frequently when speaking with operational managers in Wholesale Distribution, I ask, “What is your most important process to digitalize?” They respond, “The return process.”

The distributor’s customers are continually concerned about the urgency of providing much-needed product and don’t want to lose time in sourcing additional orders in fear of lost business.  For the specific case of spare parts, and due to the urgency of repair, when multiple solutions for the repair exist, customers prefer to order all the possible parts to save time, and then return the unneeded parts afterwards.

Eventually, excess stock decreases their available treasury on hand and valuable shelf space.  The new generation of wholesale customers do not like to keep materials or parts in stock without immediate use which negatively impacts their cash flow and inventory turnover.

Therefore, the return process is still a traditional process, but remains complex, requiring multiple authorizations before the money is returned and multiple reviews have taken place.

Indeed, at the example of the big leaders of B2C E-commerce, who offer easy returns without discussion and give credit back even before the product has reached the warehouse, there is a strong difference with the classical Wholesale Distribution returns process in B2B.  Product returns first go through quality inspection, are sometimes returned to the supplier for audit, and sometimes after 3 weeks of processing are stamped “ok,” followed by another week to process the credit to the bank account, if the paperwork is not lost somewhere in Sales administration.

This process is very frustrating to wholesale distributors who closely manage their inventory and cash flow.  Complicated and delayed reimbursements affect their loyalty to the distributor for future business.

Alternatively, at time when customers are free to quickly process returns for immediate credit, they sometimes take advantage of the system and fraud can occur when they attempt to return competitive products.

This is exactly where a digital solution for returns starts to make the most sense.  Digitizing returns that can be processed through a smart phone application referencing on-line orders, immediate inspections and triggering automatic reimbursements can be a seamless experience for customers and wholesale distributors.

The return does not have to be the enemy of wholesale distributors, when processed with new digital tools, this is fact your best sales agent, as customers will prefer to work with people who are easy to do business with and where returns are seamless.

What is your Distribution business doing to make it easy for your customers to do business with and make their return process seamless?