Ever since the eCommerce industry took off in India, RTOs have walked hand-in-hand. Even the most successful businesses find themselves dealing with a pile of RTOs regularly. These delivery exceptions can start small but can result in a `large pile of failed deliveries and eventual losses.
While there can be multiple reasons for RTO shipments, delayed deliveries or stuck shipments are the most common reasons that buyers return the product to the sellers. Customers might feel powerful when returning the products when they do not meet the expectations of the consumer. But, for the seller, it might be a nightmare to see the product return back.
While there has been an increase in demand for online shopping, products are more likely to be returned than physical shopping. This can impact the profitability if not taken care of properly.
A failed delivery attempt can be turned into RTO. A provider will attempt two or three delivery attempts and when it becomes unsuccessful, the order is placed in RTO. NDR plays a major role in RTO returns.
What is RTO
Return to origin refers to the non-delivery of an order placed and sent back to the place from where it was picked up, i.e., the seller’s address or warehouse. RTO happens when an order fails to reach the buyer, or the buyer refuses to accept the order. There can be multiple reasons for an RTO, but the most common ones include the unavailability of a buyer, an order placed by mistake, the no longer requirement of the product, and more.
The reason for non-deliveries is often mentioned in the NDR reports shared by the shipping partners. But what is an NDR report?
What is NDR?
A non-delivery report is a message given to the eCommerce seller by the courier partner on the dashboard informing that a particular shipment has not been delivered. The reasons why the delivery failed are further provided. Following this, the carrier makes two delivery attempts. If the order is cancelled in the first or multiple attempts, the order is given the status of RTO, which means the product is returned to the seller or the original warehouse from where it was picked.
Why are RTOs a Nightmare for eCommerce Businesses?
RTOs can be a nightmare for any eCommerce business. When a customer returns the product, the price of forward and return shipping both has to be borne by the seller; businesses get an additional task to track shipments that are stuck in transit. These products can’t either be restocked while in transit nor can they be sold to other customers.
Restocking those orders is again a costly affair. Sellers have to bring in staff to handle the return orders and check whether they are in appropriate condition before restocking them.
Reducing RTOs in eCommerce can help your business avoid these costs.
Top 6 Ways to Reduce RTOs in eCommerce
Now that you know how important it is to save RTOs, let’s dive deeper into how you can avoid them:
Verify Contact Details and Address
The likelihood of reducing RTOs due to incorrect addresses or contact details can be reduced by verifying them before the order is picked up by the courier partner. You can set up a process where the address and contact details shared by the customers can be verified on your platform or dashboard. eCommerce shipping platforms offer this value-added feature on their AI-powered lead qualification platforms.
Offer Multiple Payment Modes
Accept payments with a range of payment options such as debit card, credit card, UPI, digital wallets, cash on delivery, etc. It provides customers an option to pay from their most convenient mode, potentially reducing the chances of failed COD orders or payment related issues.
Improve Product Packaging
Investing in high quality packaging materials and the way products are packed helps in keeping them safe during transit. Ensure that you pack the fragile items carefully with appropriate cushioning to reduce the risk of damage while in transit.
Ensure Quick Deliveries
When a product is rapidly delivered, the chances of RTOs are reduced. As soon as the customer places an order, he wants them in his hands as soon as possible. When a product takes time to be delivered, the customer’s mind might change, and he may opt for an alternative or the same product at a cheaper cost. Prioritizing efficient shipping processes by partnering with logistics aggregators, D2C sellers can provide an efficient delivery experience ultimately leading to reduction in RTOs.
Transparent Tracking Communication
Customers often place orders and often forget what they had placed. By communicating whereabouts of the product, sellers can keep them informed and reduce uncertainty that buyers might have in their minds. You can establish proper communication channels through SMS, email, and WhatsApp to keep them informed about the estimated date of delivery and time. This increases transparency and reduces RTOs.
Offer Delivery Preference Customization
Allow customers to choose their preferred delivery time and speed. By catering to such preferences, sellers can improve the overall delivery experience. Prioritizing customer convenience helps build trust and loyalty, eventually reducing RTO rates.
The Bottom Line
By implementing the strategies mentioned above, you can definitely make significant changes to reduce RTOs. Another powerful strategy revolves around partnering with RapidShyp, which helps in reducing RTOs through its tech-enabled platform. As soon as the order is processed on the platform, automated communication is sent to the buyer through SMS, Email, and WhatsApp to confirm orders and verify the address. Additionally, regular communication and transparent tracking is sent to the buyers, helping reduce RTOs.
Frequently Asked Questions
Q1. What is RTO in eCommerce?
A1. RTO occurs when a customer’s order is not delivered and is returned to the place from where it was picked up. Common reasons for RTO include incorrect addresses, buyer unavailability, or the buyer refusing the order.
Q2. How does NDR contribute to RTOs?
A2. NDR is a notification from the courier partner indicating why a delivery failed. If the delivery cannot be completed after multiple attempts, the order is classified as RTO and returned to the seller.
Q3. Can we reduce RTO charges?
A3. Yes, RTO charges can be reduced by implementing several strategies. Verifying customer contact details and addresses before shipping helps avoid incorrect deliveries. Offering multiple payment options, particularly encouraging prepaid orders, can also minimize the risk of RTOs. Additionally, ensuring quick and reliable deliveries, maintaining clear communication with customers, and allowing them to customize delivery preferences can significantly lower RTO occurrences and, consequently, reduce RTO charges.
Q4. How to solve the RTO problem?
A4. Solving the RTO problem involves a multi-faceted approach. Start by verifying the accuracy of customer details before dispatch to avoid delivery errors. Offer a variety of payment methods, with a focus on reducing cash-on-delivery (COD) orders, which are more prone to RTO. Improve your product packaging to prevent damage during transit and ensure quick, reliable deliveries to keep customers satisfied. Use transparent tracking and regular communication via SMS, email, or WhatsApp to keep customers informed about their order status. Additionally, consider partnering with a logistics provider like RapidShyp, which offers automated communication and tracking to further reduce RTO rates.
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