Product returns are an increasing problem, especially in multichannel retail. For instance, many consumers find it very convenient to order products for Click&Collect and then return unwanted products to store. Many retailers consider dealing with returns as an unavoidable cost of doing business, yet they are unaware of the scale and importance of the returns problem. It is a multifaceted challenge that requires interdisciplinary solutions. We are a team of academics working with retailers and manufacturers to explore ways to streamline returns processes, assess the true costs of returns, influencing customer behaviour, making returns more sustainable, using circular economy concepts, and other aspects.
Our newest project, entitled "Many Circular Returns: Developing a Framework for the Circular Economy in Retailing" is funded by CIMA, the Chartered Institute of Management Accountants.
Our article in The Conversation has been read over 70,000 times so far, been translated to Indonesian, and been picked up by over 50 Media outlets.
The ground-laying project was conducted by the University of Portsmouth on behalf of the ECR Community Shrink and On-shelf Availability group, who are now called ECR Retail Loss group. A growing cross-institutional research group has emerged from it, with people working on various streams of research relating to product returns. The team currently includes researchers from the universities of Southampton and Portsmouth. We are also working with researchers from Cranfield, Sheffield and Sheffield Hallam. In 2022, we started to collaborate with Appriss Retail, who are generously funding three MSc dissertation project internships.
We explore the applicability of circular economy principles to multichannel retail. Figure 1 shows the original version for manufacturing(used with permission, courtesy of Tecnologie del Filo, Tecniche Nuove, Milano), whereas Figure 2 illustrates the application of the circular concept to product returns.
Please get in touch with Gina Frei at (product-returns@soton.ac.uk) if you are:
There are a number of ways to work with us, including the following:
We look forward to hearing from you!
Members | Job role |
---|---|
Regina (Gina) Frei | Director, and Associate Professor of Operations and Supply Chain Management |
Denise Baden | Professor of Sustainable Business |
Steffen Bayer | Lecturer in Business Analytics |
Enrico Gerding | Associate Professor |
Lisa Jack | Professor of Accounting at Portsmouth Business School |
Stephanie Law | Associate Professor of Law |
Michelle Newberry | Associate Professor of Criminology |
Soroosh Saghiri | Associate Professor of Operations Management |
PK Senyo | Lecturer in Information Systems |
Jason Sit | Senior Lecturer in Global Marketing at Portsmouth Business School |
Pamela Ugwudike | Associate Professor of Criminology |
Gary Wills | Emeritus Associate Professor in Computer Science |
Danni Zhang | Post-doctoral Research Fellow, EDO Officer |
Pingli Li | Associate Professor of Accounting |
We collaborate with the Reverse Logistics researchers at the Universities of Sheffield, Sheffield Hallam and Cranfield.
Former:
Contact details
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Completed MSc projects:
The South Coast Doctoral Training Partnership (SCDTP)
The Thematic Cluster Pathways (TCPs): sustainability, environment & resilience (SER).
See: https://www.southcoastdtp.ac.uk/thematic-cluster-pathways/sustainability-environment-resilience/
Deadline of studentships application:
Electronics & Computer Science (ECS)
Southampton Business School (SBS)
Most retailers list sustainability as an important aspect of corporate social responsibility and have a set of programmes to approach sustainability across their productions and forward supply chains. Many of them exclude product returns from their sustainability strategies or only consider the impacts of end-of-life products. This is plausible that they have only started paying attention to the financial impact of returns in recent years. Unfortunately, a rapid increase in returns and the activities of sending products back and forth have harmful effects on the environment, reflected in increased transportation, wasteful packaging, and increased greenhouse gas emissions. Additionally, many returned products cannot be resold and go to waste. There is an urgent need to implement sustainable operations and reverse logistics in returns.
Our current product returns project identifies a clear gap in implementing sustainable strategies on product returns across the retail industry. While various recommendations have been proposed for reducing the environmental impact of product returns and embedding the returns to the corporate sustainability omissions, the cost and benefits are unclear and lack scientific evidence. That is, the scientific understanding of returns and their degrees of (un-)sustainability is still at an early stage. For example, the study by Jack et al. (2019) has suggested that organisations should encourage manufacturers to redesign their products for easy disassembly, repair, recycling that would benefit the returns management. However, retailers are uncertain about the costs and benefits of implementing sustainable strategies.
Therefore, future studies could build a simulation model to quantify (1) the financial benefits (e.g., the savings on refurbishment cost) and (2) the amount of reduced wastes and energy-saving if a number of sustainable approaches have been implemented in product return, in contrast to the circumstance where non-sustainable approaches are employed.
We believe that having such further research not only makes theoretical contributions in the field of sustainable returns’ operations and circular economy but also could motivate organisations and policymakers to implement sustainable strategies on product returns in practice.
A growing body of literature recognises the importance of developing sustainability management in operations. Several environmental assessment methods (e.g., Material flow analysis, Life-cycle assessment) have been well-established to assist practitioners in making more sustainable decisions in their forward supply chain. These include material flow analysis (MFA), life cycle assessment, Economic Input-Output Life Cycle Analysis, and material flow cost accounting. However, there is limited research in building a systematic assessment approach to evaluate the environmental impacts of returns or reverse supply chains more generally. It is plausible to use the forementioned methods in reverse supply chains to evaluate the impact of returns.
For example, the assessment of MFA can quantify and evaluate energy use and substance flows, and their effects on the environment within a well-defined framework. It is extrapolated that within a reverse supply chain, MFA may help practitioners to map, quantify, inspect, and evaluate the environmental influence of the flows (e.g., materials of package and carbon emissions) that are associated with the returned items at each stage of a reverse supply chain. Meanwhile, practitioners can use the MFA method to compare the different returns-process options (e.g., disposal vs. refurbishing) by calculating the quantity of their environmental impacts. That is, the findings generated by MFA provide scientific evidence that assists practitioners in making more sustainable decisions.
Thus, a research project to explore the effectiveness of different assessment methods on measuring the environmental impact of returns throughout the reverse supply chain is worthwhile. This could help practitioners find new solutions for reducing returns’ negative impact on ecological sustainability and the possibility of placing future resources at risk. In other words, having environmental assessment methods is crucial for practitioners to embed circular economy values within their reverse supply chain’s operation.
Other possible research directions on sustainability:
Key words: prospect theory, risk-seeking, the utility theory, agent-based modelling
Fraud returns is rapidly becoming prevalent for modern retailers because of liberal returns policies. Kind (2004) highlighted that fraudulent returns could erase 10%-20% from a retailer’s profit margin. Our current returns project investigates the influence of return policies and various interventions on different types of fraud returns. We suggest that fraud behaviour could be related to how people perceive risk. Applying the prospect theory, it assumes that offenders try to maximise their utility, that is, their fraud behaviour depends on costs (risk) vs. benefits. Further investigation and experimentation on how individuals perceive the risk (cf. benefits) of involving in fraud returns is recommended.
The data collection could be via survey with various experiment settings which offer different scenarios by asking individuals to make discrete choices, and then identify when they switch their choices while facing different gains and losses. For example, if there is an 80 % chance of getting a refund when returning a product dishonestly, but the chance of getting caught (with various interventions and types of fraud) is 20 %, what would participants do (quit or engage with the fraud returns). By doing so, the experience can quantify the costs and benefits, and then translate that behaviour into an agent-based model. Further modelling work could determine the extent of different types of interventions in great detail.
Jack, L., Frei, R., & Krzyzaniak, S. A. C. (2019). Buy online, return to store: the challenges and opportunities of product returns in a multichannel environment.
Increasingly, technology is used to reduce in-store fraud and theft. A promising technology is the use of RFID tags on products such as clothing. These tags are cheap to produce and can detect the items from within a certain range. There are wide-ranging applications of RFID tags including inventory management, unmanned stores and preventing fraud. Several types of fraud can be easily prevented due to the ability to identify a unique clothing item and being able to match this to the transaction. Also, the items can be tracked within the store and when leaving the store. There are also opportunities to use AI to predict the likelihood of fraud, enabling a timely intervention to occur before the fraud takes place. While the technology raises many opportunities, there are also ethical and legal concerns, e.g. in terms of privacy and potential bias in the data and algorithms. There are also opportunities to improve sustainability especially in the clothing industry (Denuwara et al, 2019). This project is about investigating both the opportunities and the ethical concerns, how technology can be used to address some of the concerns, and what people find acceptable. There is a strong connection with the responsible innovation agenda, as well as trustworthy autonomous systems.
S. L. Garfinkel, A. Juels and R. Pappu, "RFID privacy: an overview of problems and proposed solutions," in IEEE Security & Privacy, vol. 3, no. 3, pp. 34-43, May-June 2005, doi: 10.1109/MSP.2005.78.
Denuwara, N.; Maijala, J.; Hakovirta, M. Sustainability Benefits of RFID Technology in the Apparel Industry. Sustainability 2019, 11, 6477. https://doi.org/10.3390/su11226477