Hafback brings the first true green returns solution to online merchants.
In the dynamic world of e-commerce, a significant yet often overlooked environmental challenge remains: product returns. Shockingly, nearly 1 in 5 online purchases are returned, ballooning to nearly 40% for apparel. In 2023, this reached a staggering $247 billion in online returns.
As the digital marketplace continues to expand, the need for sustainable practices in reverse logistics has become increasingly urgent. Hafback is at the forefront of addressing this challenge, offering an innovative and truly green returns solution for online merchants.
Understanding the Overlooked Issue of Reverse Logistics
The focus for most ‘environmentally conscious’ brands has been on using sustainable product materials and packaging. Some brands do go a step further, prioritizing manufacturing practices that lower water consumption and use renewable energy. Forward logistics has seen a modest amount of innovation but still relies heavily on carbon credits to claim carbon neutral shipping. However, the path consumer returns take back to the warehouse, known as reverse logistics, has been largely neglected. This oversight is significant, given the alarming statistics.
Returning these items from the consumer to the merchant’s warehouse creates an additional 10 billion trips and 16 million metric tons of CO2. That’s the equivalent annual output of 3.5 million cars. But it's all worth it because these products stay in circulation, right?
Wrong. Global estimates show that nearly 6 billion pounds of returned products end up in the landfill every year.
“Do we try to educate consumers and tell them, ‘Well, a lot of the stuff that you return actually ends up in a landfill?
Well, that makes us look like idiots.'”
-Joel Rampoldt, AlixPartners
The Truth Behind Green Returns and the Urgency for Change
As online shopping outpaces brick-and-mortar stores, the handling of consumer returns becomes a pivotal component in a brand's circularity journey. You may have heard the term “green returns” thrown around, but what exactly is a “green return”?
The prevailing definition will tell you this is when you refund the customer and let them keep the product. As a consumer, you may know this as the “just keep it” return method. That doesn’t sound like a solution to us. That sounds like an ostrich with its head in the sand.
Unfortunately, this approach to green returns has been far from effective. It does nothing more than shift the burden from the retailer onto the customer. This results in two outcomes: A customer happy to keep the product for free, but now conditioned to expect this on future returns. The other is an unhappy customer, one who has no use for this product and now burdened with finding an outlet for it.
This approach often leads to products being resold on secondary marketplaces without brand control or, worse, ending up in landfills.
A Merchant's Perspective: The Challenge of Handling Returns
From an operations standpoint, the complexity of handling returns is evident. You have to account for the additional inbound volume and warehouse space to accommodate the stagging and processing line. Processing returns requires additional labor and materials. To store and sell these items as open box would exponentially grow your warehouse overhead as you would need to create new open box SKUs and pick locations.
With limited options for repackaging or reselling open-box items, many businesses resort to landfill disposal or liquidating at a significant loss. This approach is not only environmentally harmful but also financially unsustainable.
Introducing Hafback: A Game-Changing Solution for Green Returns
We define green returns as the path of least impact combined with peak circularity. A green return has the lowest carbon emissions created by transit, the lowest number of touches, no additional raw material consumption, and keeping the product in customer’s hands and out of the landfill to achieve true circularity.
Hafback steps in as a pioneer, offering the first comprehensive green returns solution. By eliminating the traditional reverse logistics cycle and providing a platform for merchants to sell open-box returns at deep discounts, Hafback addresses both environmental and financial concerns.
How does Hafback achieve this? Through an innovative Returns Management Software integrated with a recommerce marketplace. This system allows products to be resold immediately upon return initiation, enabling direct shipping from the original consumer to a new buyer. This process eliminates the need for products to return to the warehouse, significantly reducing environmental impact and operational costs.
A Win-Win-Win for the Environment, Merchant, and Customers
By adopting Hafback's solution, merchants not only contribute to environmental sustainability but also enhance their bottom line. This approach represents a true green returns solution, aligning with the values of eco-conscious consumers and forward-thinking brands.
To learn more about how Hafback is transforming the e-commerce landscape with sustainable reverse logistics, reach out to our sales team at sales@hafback.com or book a demo today.
