High return rates are a way of life in the automotive aftermarket. It's not unusual for repair technicians to misdiagnose problems, for catalogs to contain incorrect information, or for auto parts companies to source the wrong product. For example, up until recently, one such supplier, Massachusetts-based Autopart International, had return rates of 10 to 25 percent. But as the company sought to expand its presence nationally, reducing that return rate and its overall inventory investment became a priority, according to Chris Crowley, the company's chief information and supply chain officer.
In a presentation at CSCMP's 2010 Annual Global Conference, Crowley explained that Autopart International's management views a return as a failure in the sales process. So it makes sense that a key part of its strategy to reduce returns was to provide employees with better product information at the point of sale.
After analyzing the problem, Autopart International concluded that many returns could be avoided just by providing its staff with the right questions to ask customers to make sure they ordered the correct part. As the first step toward resolving the issue, the company started collecting and analyzing the reasons customers gave for returning products. "We began to manage information intensely," said Crowley.
This information was then used to create notes that would be entered into the order management system as a means of alerting order takers to special instructions for specific parts. For example, a note might say, "Tell the customer that before installing this part to make sure to shave off the rust around it; otherwise it won't fit," or "Ask technician to describe the shape of the brake unit to make sure he or she is ordering the correct one." Employees were also allowed to enter their own personal notes into the system.
This simple fix produced profound results. The company reduced returns by one-third and greatly improved overall customer satisfaction. Crowley related that many of the company's customers reported, "You guys ask me the craziest questions, but I always get the right part."