When it comes to retail, technology is breaking traditional business models. Shopping is now a global experience that enables retailers to market and sell their products to customers anytime and anywhere, transforming the worldwide economy. According to Forrester estimates, U.S. retail online sales will exceed $520 billion by 2020. And globally, online sales are growing three times faster than GDP. It’s becoming increasingly clear that in today’s world, living the Good Life includes buying and returning goods with the click of a button.
Consumers – especially those who live in cities – view reliable e-commerce as an important measure of quality of life. But with this cultural shift come expectations for immediate gratification and convenience, as well as unexpected consequences that are impacting both businesses and the environment. As e-commerce becomes a way of life, the number of items that are shipped multiple times before reaching end consumers continues to rapidly increase. By 2019, UPS expects half of its deliveries will be consumer packages delivered to residential addresses. These lower-density deliveries have more stops, with fewer packages delivered at each stop, resulting in more miles traveled, more fuel burned and more emissions released.
As e-commerce continues to grow, so do the number of packages being returned. Each year, consumers in the U.S. return about $380 billion worth of goods that leads to five billion pounds of waste in our landfills. In addition to the financial and environmental costs, today’s retailers are facing unprecedented challenges related to the growing expectation that returning an item should be as simple and convenient as receiving it. And while many retail supply chains are optimized for forward movement, they are oftentimes ill-equipped to accommodate goods that come back into them. With more and more packages being destined for homes, a comprehensive reverse logistics portfolio has become even more critical to providing an exceptional consumer experience that meets business objectives and ensures the returns process is handled with sustainability in mind.
With goods flowing in multiple directions among manufacturing facilities, warehouses, stores and consumers, traditional supply chain models are no longer sufficient. Now is the time to bring in new practices that are efficient and cost effective, while also environmentally conscious. The importance of “good reverse logistics” is the pinnacle of UPS and Optoro’s innovative partnership model that aims to provide retailers with a one-stop shop to optimize the transportation and disposition of returns and excess inventory. Our joint reverse logistics solutions combine UPS’s operational and logistics expertise with Optoro’s software platform that maximizes recovery value and reduces environmental waste.
At our joint breakout session at Sustainable Brands ’18 moderated by Forum for the Future’s Sally Uren, we will focus on how retailers and brands can Redesign the Good Life by balancing the on-demand consumer economy with its environmental consequences. Attendees will get a chance to explore and discuss the latest consumer insights, emerging strategies on collaboration and innovation, and practical ways to address the many logistical, economic and environmental challenges associated with excess shipments.
We hope you will join us for a lively discussion!
By: Crystal Lassiter, Senior Director of Global Sustainability, UPS
Adam Vitarello, President and Co-Founder, Optoro
June 5, 2018