Above the Fold: Supply Chain Logistics News (November 4, 2022)

By Adrian Gonzalez

What does an ethernet cable taste like?

I don’t know, but our pet bunny Grayson does. He chewed through my ethernet cable earlier this week, leaving me at the mercy of wifi, which is always reliable except when it isn’t.

Now I’m watching YouTube videos on how to crimp RJ45 connectors.

I learn something new every day. Except what ethernet cables taste like, because Grayson is not talking. He’s taking the Fifth.

So, while I deal with issue, here’s the supply chain and logistics news that caught my attention this week:

Like Free Shipping, There’s No Such Thing As Free Returns

Product returns is another example of how “the way we’ve always done it” is just not going to cut it any more. Retailers have been so focused over the past few years on omni-channel retail, on the sell side of e-commerce, that they have virtually ignored (underinvested in) their ability to effectively manage product returns, the hangover headache of e-commerce.

I wrote that back in January 2018, and almost five years later, the hangover headache continues (and it’s arguably worse than before).

“As e-commerce remains healthy, retailers from Athleta to Zara are shortening refund and exchange windows and charging customers restocking fees,” reports Rachel Wolfe in the Wall Street Journal.” Here’s more from the article:

In June, the Gap, Inc. shortened the window for customers to take apparel back to its Athleta, Gap, Banana Republic and Old Navy brands from 45 to 30 days. J.Crew, too, halved its return window from 60 to 30 days and Zara instituted a $3.95 fee for online orders returned by mail this past summer.
In 2021, 18% of retailers didn’t offer free shipping on returns; this year, twice as many don’t offer free return shipping, according to a survey of 300 retailers conducted by Inmar Intelligence.

Do we as consumers need to be weaned off “free” shipping and “free” returns that are unprofitable (and not good from a sustainability standpoint either), or are they still an opportunity for retailers to differentiate themselves against the competition if they can offset the costs elsewhere?

For related commentary, check out “Product Returns: The Hangover Headache Of E-Commerce” and “Product Returns: Another Moment Of Truth.”

UPS: Bolder is Combining Digital Solutions with Global Integrated Network

As Max Garland reports in Supply Chain Dive, “UPS is building a logistics-as-a-service offering by combining [its integrated physical network with] the capabilities of its standalone digital services [including] crowdsourced same-day delivery provider Roadie, 3PL Coyote Logistics, delivery platform Delivery Solutions, financial services provider UPS Capital [and] its ‘delivery density’ partnership with CommerceHub.”

During the company’s earnings call last week, UPS CEO Carol Tomé said, “Bolder is about moving faster to grow in our targeted market segment. It’s also about combining digital solutions with our global integrated network to create more value for our customers and new revenue opportunities for UPS.”

Back in August 2015, I offered this advice to logistics service providers: be bold and different. I’m not sure if that post inspired UPS’s current “better and bolder” strategy, but this news is another example of how the logistics industry is transforming.

That is, of how logistics networks and technology platforms are coming together to enable broader and more powerful network effects.

I’ll have more to say on this topic in future posts.

In the meantime, have a happy weekend!

Song of the Week: “Fake Empire” by The National