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hi this is Tim Conrad with jabo ATC we're here to talk about how retailers use some of their manufacturing partners invest too much time for tuinal return about 8% of all retail purchases are returned many of these returns are sent back to the original vendor final disposition in some cases this makes sense but often this process is an unnecessary waste of time and resources that literally sucks the profit out of companies there is a better answer that can contribute millions of dollars in added profit to a product manufacturers bottom line let's take a look at the heart of the problem is the cost involved missing this product back to the vendors facility great the storage costs labor costs remarking and recycling costs as well as credit reconciliation cost because these costs are assigned many different departmental budgets we find that companies often have no idea how much they spend they do however have a good handle on the cash they recover on these assets in fact the primary goal of many disposition programs is to maximize recovery value on these school returns but this is a misleading metric the better goal would be to maximize net recovery which is the cast recovery value minus processing loss in this graphic you can see the impact of a typical return to vendor or RTB process and have recovery the longer the process takes the more overhead costs are incurred and the more the ending inventory loses value time is the enemy here for most RTV product extending the disposition cycle has a negative impact on recovery values and company property today the process often looks like this with vendors performing any and all disposition activities facilities the better answers to simply accelerate the disposition processes by making decisions and performing these tasks at the retailers return center or even a multi-client regional facility close to the retail stores under these facilities are often operated by third party reverse logistics specialists who routinely perform these value-added services many are experienced and product remarketing recycling and grant protection our work with consumer goods manufacturers suggests this strategy can reduce cash cycle time by 30 to 100 days and improve net recovery by twenty to fifty percent now its accelerated disposition right for every wonder no to determine if it makes sense for you it's important to do a careful analysis for each product category an aggregate analysis across all product does not work since each product category has unique processing requirements and recovery potential Jenko atc has a deep link analysis process summarized here that we perform for companies that process a large volume of RTV product for more information download our whitepaper on the subject if you have questions or would like to explore the idea further I'd love to hear from you to send me an email or give me a call