Returns are a fact of every retail business and managing returns effectively can improve buying decisions and allocation of inventory, maximizing sell through. Toolio provides return profiles to plan for the effect of returns on both sales and inventory as well as accounting for delays in the processing of returns.

To create a return rate profile, navigate to Settings > Intelligence > Return Profiles and click Add

Name the return profile and set the following inputs

This is the expected number of units that will be returned after being sold, this will vary depending on the category and therefore different profiles can be defined.

The return delay estimates the time in weeks between a sale being made and returns typically coming back from customers.

The reuse rate defines the amount of returned inventory that can typically be sold again after quality review and repackaging.

The reuse delay estimates the time in weeks between the units being returned and the ability to sell the units to customers again, this would include the time taken to process, QA and repackage/label the items

Note that if returns can not be resold, the reuse rate would just be set to 0%

To create different profiles for different classifications, you can also use partitioning. This will make it easier to group different profiles together.

Once you have created a partitioned Return Profile, you can input the values for each partition on one screen.

Return metrics are separated into Sales Returns and Returns (Inventory). The separation allows for the independent measurement of returns effect on Net sales vs the inventory effect of returns on EOP and thus receipt and transfer projection. In the example below, 10% of the sales are returned 1 week later with 50% of those returned units available in inventory the week after that.

Return profiles can be leveraged in both allocations and the assortment plan to have more control over Transfer Order or Purchase Order decisions.

The below video walks through an example of the impact return profiles have on receipt generation.