Clothing returns can be streamlined through DPP
Online shopping has become increasingly common and studies have shown that digital commerce produces far more returned goods than when compared to retail. Most often, it is free to return goods, which may be one reason. More returns produce more shipments, and when those shipments are made with fossil vehicles, emissions increase. In addition, it happens that companies throw away the products that are sent back, because it is not considered economically justifiable to take care of what is returned.
- The DPP has huge potential to be a piece in the puzzle of how to make retail more circular, says Klas Hjort, at Real - Center for Trade and Logistics onto Lund University. With DPP, companies can move from linear to circular production and at the same time make a profit.
For example, the DPP could reduce business costs so that it becomes both economically and environmentally justifiable to look after what is returned.
- One reason why returns are seen as too costly to handle is that the information on why the product is returned is often given on paper that is sent back together with the product, continues Klas Hjort. You don't know what you're dealing with until the return opens and by then it's often too late. For many, this becomes costly to handle and they throw away the goods. A sensible way to do this is through a digital platform where the information provided can determine how the return will be handled.
Klas Hjort therefore sees DPP as a good starting point for a transition from linear to circular economy for return management. With a digital product passport, the garments already have a digital identity that makes it easier to manage return flows.
- Digital platforms allow you to optimize and control return management so that resources are managed more sustainably. It is possible to connect customers with the retail industry directly, tell customers if they are returning late or in other ways teach them a better way to manage the returns system.
Through the DPP it is also possible to detect whether returns are due to unclear or incorrect information about the colour, shape and size of the clothes.
- If we can create information about the returns and, in addition, provide it to those who design the products, it should lead to fewer returns. By learning from each other, we are developing a better system for how we can avoid clothes being sent back.
Klas Hjort also talks about other problems regarding the sale of designer products. It happens that organized groups, perhaps so far mostly in the United States and in the United Kingdom, steal products and get money back without a receipt. Another option is to buy an expensive product but then return a copy and get a full refund, and the design shop has instead received a copy into the system.
- This can happen because it is not possible to identify the specific product with the receipt, but through the DPP it is possible to verify that the product is genuine.
Already now it is possible to see companies that are the forerunner in digitizing the return process.
- Nudie jeans have a repair guarantee that they are repaired close to where the customer is located, says Klas Hjort. Stadium has digitized the return process and connects warehouses, shops and service opportunities in its return system. They have thus greatly reduced the cost of return handling. In addition, faster handling allows you to sell the products again before the end of the season.
For the second-hand industry, the DPP can also be a relief.
- When we examine what customers think about secondhand in Sweden, they say that it takes a long time for the garments to arrive in the store, that it costs quite a lot when compared to buying cheap new garments and that logistics are often more expensive and more complicated. To scale the industry, you need to have information carriers on the products so that you can automate even that process,” concludes Klas Hjort.