If you are running a business, then you realize, no doubt, that some of your goods will come back to you.
Here are some tips that will lessen the pain – both financial and emotional – of dealing with rejected goods.
Maintain a Clear Policy
Before selling the products of any particular company, including your own, make it a point to discuss who will ultimately shoulder the cost of replacing rejected goods. Failure to do so at the outset of the business relationship could result in your warehouse being filled with rejected goods – after you have made all the payments to your supplier.
It’s important to discuss the procedure that you’ll use to accept, examine, and then replace all returned products. If your supplier will not agree to take back goods that have been returned under warranty, then terminate that supplier immediately.
Your customers will be buying products on your assurance; if they are rejected, you will be answerable to them and your small business’ reputation may suffer.
Keep Track Of Returns
If your goods have been rejected due to an ordering or fulfilling error, then they can go back into your inventory; but if the goods are defective, then you might have to replace them. In this case, you’ll have to send the defective product back to your supplier and wait for the supplier to provide the replacement for you.
Keep track of all these items so you know their status at any given time.
Think Of Alternatives
If your supplier has an authorized service center in your neighborhood, you can make an agreement in which you can be responsible only for the sale of the products. If there are any problems with quality, your customers could take them to that service center for any repairs or replacement.
That way, you will be free from any liability after selling the products.
Alternatively, you could take on the additional role of an authorized service center, since you would then be able to earn money on products that have moved out of warranty.
You will, however, need to employ experts who can successfully repair the defective products.
Factor the Cost of Rejected Goods into Your Budget
You should calculate the cost of collecting, shipping, and then taking back the rejected goods in your product costs since it is an expense that most business people have to incur while running a business.
You should calculate the percentage of products that are returned compared to your total sales and incorporate the costs into your product sales price.
Understand That Replacing Products Builds Goodwill
You might not want to replace rejected goods, but it is necessary to build goodwill for your small business. It is a time and money-consuming aspect of your business but a necessary one. Your customers’ faith in you is at stake.
These tips will help reduce the pain of handling rejected goods – and enhance your business’ status in the marketplace as an honest and fair company.