Business Intelligence

Are Product Returns A Necessary Evil?

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Executive Summary

Many firms may actively discourage product returns. But this could be a costly mistake because managing product returns effectively can boost sales and profitability. "Many firms treat customers who return products as thorns in their sides," he notes. "These firms often offer disincentives for customers to return products and/or make the product return process more difficult for a customer to complete." However, Petersen has found that customers who return 10-15% of what they purchase are, on average, a company's most valuable customers into the future.

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