For the Record
Staff -- Logistics Management, 1/1/2003
The table labeled "What it costs to process a return" that appeared in the June 2002 story titled "The Seven Deadly Sins of Reverse Logistics" contained some errors that kept the components from adding up correctly. Here's how the table should have read:
| Returns Process | Cost per item | Activities |
| Customer service time to authorize return | $2.10 | RMA (return merchandise authorization) process time |
| Inbound shipping | $4.00 | Parcel/LTL shipping |
| Inbound receiving | $0.49 | Dock labor |
| Putaway to return area | $0.31 | Stock labor |
| Storage space for returns processing | $0.43 | Cost while in warehouse |
| Returns processing | $2.21 | Labor, systems, paperwork |
| Credit processing | $0.78 | Entry labor, paperwork |
| Customer service | $0.15 | Receive customer inquiries |
| Pre-disposition putaway and storage | $0.12 | Labor and temporary storage |
| Repackaging/Refurbishment | $3.80 | Packaging, labor, labels |
| Disposition/Disposal/Return to vendor | $1.68 | Palletizing cost, shipping |
| Total cost of processing return | $16.07 | |
| Source: Tompkins Associates The cost to process and handle a returned item can be greater than the value of the item itself. Here are some of the potential costs of handling a return. |
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