1 00:00:00,200 --> 00:00:03,520 You don't want to see your product being sold in in 2 00:00:03,520 --> 00:00:07,800 countries where the return rate in in the United States is 3 00:00:07,800 --> 00:00:11,000 bigger than the entire reset, than the entire forward sales. 4 00:00:11,160 --> 00:00:14,200 If you take that product and export it into smaller markets, 5 00:00:14,480 --> 00:00:17,560 the returns volume could be bigger than your forward volume 6 00:00:17,880 --> 00:00:19,880 and it could truly disrupt that, Brad. 7 00:00:30,960 --> 00:00:33,480 Hello and welcome back to the retail podcast. 8 00:00:33,760 --> 00:00:37,160 I'm joined by sender Seamus, the CEO and Co founder of Return 9 00:00:37,160 --> 00:00:40,880 Pro, And I think we're going to, we're in for an interesting 10 00:00:40,880 --> 00:00:44,840 conversation with an executive from the, the, the one of the 11 00:00:44,840 --> 00:00:48,800 biggest headaches in retail that may be getting worse, given the 12 00:00:49,320 --> 00:00:52,960 what, what's been going on on a global scale from tariffs and 13 00:00:52,960 --> 00:00:55,840 everything else and how you manage that. 14 00:00:55,840 --> 00:00:59,840 But Sender I, I mean, obviously you, you, you, you built this 15 00:00:59,840 --> 00:01:04,959 business from the ground up and over 1718 years, how come you 16 00:01:04,959 --> 00:01:06,120 went for a name change? What? 17 00:01:06,120 --> 00:01:10,200 What was behind the name change? So really I think it was just a 18 00:01:10,200 --> 00:01:13,600 directed kind of targeted audience that we were going 19 00:01:13,600 --> 00:01:15,720 after. We we started the business 20 00:01:15,720 --> 00:01:19,400 strictly in the logistics world and then over time I come from 21 00:01:19,400 --> 00:01:22,200 the software world. So over time we kind of delved 22 00:01:22,200 --> 00:01:24,720 into software and then ultimately into re commerce and 23 00:01:25,160 --> 00:01:28,600 the Recon group was supposed to be or eventually TRG and then 24 00:01:28,600 --> 00:01:32,000 ultimately go TRG, supposed to be a combination of companies 25 00:01:32,000 --> 00:01:34,720 that help solve returns. And overtime we went through all 26 00:01:34,720 --> 00:01:39,520 these crazy mission statements and, and overtime we finally got 27 00:01:39,560 --> 00:01:41,960 to solving returns. I know that sounds super simple, 28 00:01:42,200 --> 00:01:45,600 but it took 16 years to get into those two simple words, solving 29 00:01:45,600 --> 00:01:48,640 returns. It took the same 16 years to 30 00:01:48,640 --> 00:01:51,920 calling it return pro. We are a collection of return 31 00:01:51,920 --> 00:01:53,000 pros. That's what we are. 32 00:01:53,000 --> 00:01:57,080 So I think it's, it's very fitting to to name ourselves 33 00:01:57,080 --> 00:01:59,200 return pro. We very much focus on returns 34 00:01:59,200 --> 00:02:00,680 and that's kind of the key initiative. 35 00:02:00,960 --> 00:02:02,720 How do we bring this product back to life? 36 00:02:02,720 --> 00:02:05,400 How do we reduce the returns? How do we go through all that? 37 00:02:05,400 --> 00:02:08,840 And that's the main reason and focus behind the the name 38 00:02:08,840 --> 00:02:10,479 change. And I think it galvanises the 39 00:02:10,479 --> 00:02:13,640 team, gives them a very clear path to what it is that they're 40 00:02:13,640 --> 00:02:16,960 supposed to achieve and and gives a very strong 41 00:02:16,960 --> 00:02:19,680 communication to our client base, customers and the industry 42 00:02:19,680 --> 00:02:21,560 as all who we are and what we do. 43 00:02:22,400 --> 00:02:26,280 Now you guys went quite big NRF, we were just talking off camera 44 00:02:26,280 --> 00:02:28,880 about your sponsorship of obviously the stage. 45 00:02:29,160 --> 00:02:32,520 I I saw your stuff in the press room and I'm conscious of the 46 00:02:32,520 --> 00:02:36,360 fact that you must have met a lot of executives while you were 47 00:02:36,360 --> 00:02:39,600 at NRF. One of the main questions I 48 00:02:39,600 --> 00:02:43,040 asked what's top of mind for for the executives that you're 49 00:02:43,040 --> 00:02:46,600 meeting within the industry or in a broader sense, what's 50 00:02:46,600 --> 00:02:48,640 what's been top of mind the people you've been meeting? 51 00:02:49,000 --> 00:02:52,040 So first of all, we, we sponsor pretty much every year. 52 00:02:52,240 --> 00:02:54,080 You know, there's different levels of sponsorship. 53 00:02:54,080 --> 00:02:57,920 We sponsor within, within our financial abilities, so to 54 00:02:57,920 --> 00:03:00,880 speak. And I mean it's very important 55 00:03:00,880 --> 00:03:03,560 to get it out there. Over the years we've been going 56 00:03:03,560 --> 00:03:06,800 as you know, TRG go TRG for the last, I don't know, six years or 57 00:03:06,800 --> 00:03:08,800 so and we go to multiple trade shows. 58 00:03:08,800 --> 00:03:11,920 I think belonging to then RF is extremely important. 59 00:03:12,640 --> 00:03:16,280 It's the largest body for for retail within the United States. 60 00:03:16,760 --> 00:03:21,160 And I think as we speak to retailers over the last decade, 61 00:03:21,400 --> 00:03:24,960 we find that a lot of the executives just didn't know what 62 00:03:24,960 --> 00:03:27,160 returns were all about. And you'd think that, you know, 63 00:03:27,440 --> 00:03:30,640 at a large enterprise retailer, they'd understand what returns 64 00:03:30,640 --> 00:03:32,720 are all about and kind of get into the degree of it. 65 00:03:33,000 --> 00:03:35,560 But it was kind of, you know, the black sheep of the family. 66 00:03:35,840 --> 00:03:39,240 It was in the corner somewhere in a warehouse or people never 67 00:03:39,240 --> 00:03:41,240 talked about it. They front loaded the cost into 68 00:03:41,240 --> 00:03:44,800 the cost of the product itself, whether on the front end when 69 00:03:44,800 --> 00:03:46,920 the purchase agreement was made between the retailer and the 70 00:03:46,920 --> 00:03:50,400 vendor or on the back end. And the back end happens a lot 71 00:03:50,400 --> 00:03:53,320 as well on the on the back end, they front loaded as as well 72 00:03:53,560 --> 00:03:56,240 into the actual cost directly to the consumer. 73 00:03:56,320 --> 00:03:59,440 And for for retailers lately with, you know, the looming 74 00:03:59,560 --> 00:04:03,640 political climate, whether it's tariffs or or inflation, they 75 00:04:03,640 --> 00:04:07,880 really needed to kind of find other avenues to prop up their 76 00:04:07,880 --> 00:04:10,960 net margins. And the beauty of of retail is 77 00:04:10,960 --> 00:04:14,800 and returns the themselves is that the more you save on 78 00:04:14,800 --> 00:04:16,800 return, the more of that product you bring back to life. 79 00:04:16,839 --> 00:04:19,680 Every single penny of that goes back to your Net margin and 80 00:04:19,680 --> 00:04:22,600 that's the cool part of it. So if, if returns represent and 81 00:04:22,600 --> 00:04:25,280 I think I think we'll get down to this path, sorry to jump 82 00:04:25,280 --> 00:04:30,080 ahead, but returns are about 890 billion in 2024. 83 00:04:30,080 --> 00:04:34,240 That's the in around number. the US sales are around, let's call 84 00:04:34,240 --> 00:04:38,400 it 8 point something trillion and out of that maybe 5.2 or so 85 00:04:38,480 --> 00:04:40,640 are consumable returns that are not food. 86 00:04:40,640 --> 00:04:43,560 So you've got you are a return rate of like, let's say 16 plus 87 00:04:43,560 --> 00:04:45,160 percent. That's a massive number. 88 00:04:45,160 --> 00:04:47,480 Most businesses don't have a 16% margin. 89 00:04:47,480 --> 00:04:51,400 So you're talking, you're talking every basis point that 90 00:04:51,400 --> 00:04:53,880 you recover goes back straight to Net margin. 91 00:04:53,880 --> 00:04:56,040 And that's the beauty of it. And these executives are 92 00:04:56,040 --> 00:04:58,320 starting to understand that. And to your point, we're 93 00:04:58,320 --> 00:05:00,200 starting to have that conversation with the jicular. 94 00:05:00,200 --> 00:05:02,320 We used to have it at the manager level, director level, 95 00:05:02,560 --> 00:05:04,400 senior director, maybe junior VP. 96 00:05:04,640 --> 00:05:07,000 Now we're starting to talk to C staff about it because they're 97 00:05:07,000 --> 00:05:08,840 very interested. And that's the cool part. 98 00:05:08,920 --> 00:05:10,560 People are finally starting to listen it. 99 00:05:10,640 --> 00:05:14,640 It took a short 17 years. Yeah, Well, I mean, look, I've, 100 00:05:14,720 --> 00:05:18,360 I've having worked with a lot of executives just before the 101 00:05:19,040 --> 00:05:23,280 inflation problem that kicked in and the cost of living crisis. 102 00:05:23,400 --> 00:05:26,120 It was, you know, how am I going to find another 25%? 103 00:05:26,120 --> 00:05:29,440 How am I going to find 15%? Because I'm not going to grow 15 104 00:05:29,440 --> 00:05:33,240 or 25% in my business. Inflation is eating my margin. 105 00:05:33,240 --> 00:05:37,160 How, how am I going to do this? And so therefore, I, I expect a 106 00:05:37,160 --> 00:05:40,960 lot of leaders will be thinking about as these because next it's 107 00:05:40,960 --> 00:05:43,200 Europe, next, you know, it's just going to keep trickling 108 00:05:43,200 --> 00:05:46,480 around the world and we'll see. And so I can imagine retailers 109 00:05:46,480 --> 00:05:48,400 are looking at what are the trends. 110 00:05:48,440 --> 00:05:51,880 I mean, you mentioned 890 billion during the holiday 111 00:05:51,880 --> 00:05:53,280 season, right? That was the. 112 00:05:53,520 --> 00:05:55,000 No, no, that's the annual number. 113 00:05:55,000 --> 00:05:56,520 That's oh, OK. That's the annual number. 114 00:05:57,040 --> 00:05:59,560 What do you, what do you know? So what do you noticing in the 115 00:05:59,560 --> 00:06:04,520 sense of trends then in terms of is everyone just ordering 3 of 116 00:06:04,520 --> 00:06:08,160 everything or why are we? Why is it such a problem? 117 00:06:08,760 --> 00:06:13,280 I think you know as as you watch e-commerce grow, obviously as a 118 00:06:13,280 --> 00:06:16,440 society, whether it's in the United States, Europe or anyone 119 00:06:16,440 --> 00:06:19,640 developed world, we are gravitating towards more and 120 00:06:19,640 --> 00:06:22,200 more online shopping. A big part of online shopping is 121 00:06:22,200 --> 00:06:24,800 obviously clothing and apparel. And we all know the clothing and 122 00:06:24,800 --> 00:06:28,960 apparel has problems, especially when people are bracketing. 123 00:06:28,960 --> 00:06:32,000 And bracketing is the practise of buying two or three of the of 124 00:06:32,000 --> 00:06:34,920 the same product in different sizes and hoping one fits and 125 00:06:34,920 --> 00:06:36,960 returning the rest. That's terrible exercise and 126 00:06:36,960 --> 00:06:39,360 there's a lot of technology that we can put into in place to fix 127 00:06:39,360 --> 00:06:41,520 that. And but reality to answer your 128 00:06:41,520 --> 00:06:44,560 question directly is that as long as e-commerce sales 129 00:06:44,560 --> 00:06:47,680 continue to grow and become a bigger factor and either way at 130 00:06:47,800 --> 00:06:50,360 brick and mortar sales, that number is going to keep growing. 131 00:06:50,800 --> 00:06:53,840 And I think that there's a lot of things we can do on the front 132 00:06:53,840 --> 00:06:57,040 end and solving returns a big part of the issue and the way we 133 00:06:57,040 --> 00:06:59,200 view it. And I think we'll kind of just 134 00:06:59,600 --> 00:07:02,280 dive right into it and it doesn't matter. 135 00:07:02,680 --> 00:07:04,200 We say this internally all the time. 136 00:07:04,200 --> 00:07:06,520 What's it doesn't matter if we have the solution or not. 137 00:07:06,960 --> 00:07:09,080 As a business, you have to think of the vision that solves the 138 00:07:09,080 --> 00:07:11,800 problem for your customer and work towards that. 139 00:07:12,000 --> 00:07:14,240 So you're the innovator. Your job is to innovate. 140 00:07:14,520 --> 00:07:16,920 Your job is not to say how can I make another dollar? 141 00:07:17,320 --> 00:07:19,960 And within that innovation you can find your space. 142 00:07:20,160 --> 00:07:21,840 How are you going to profit from that? 143 00:07:21,840 --> 00:07:24,280 So when you look at it, you need to speak to these retailers, 144 00:07:24,280 --> 00:07:26,840 vendors, brands, whatever you want to call them all throughout 145 00:07:26,840 --> 00:07:29,480 the supply chain and ask what is your issue with returns. 146 00:07:29,800 --> 00:07:32,000 And most of them depending on the category though. 147 00:07:32,200 --> 00:07:37,160 And then we, we, we basically a service 259 categories, which is 148 00:07:37,160 --> 00:07:39,680 a massive number. And we do everything from 149 00:07:39,680 --> 00:07:43,480 apparel to consumer electronics and furniture and HomeGoods and 150 00:07:43,560 --> 00:07:46,840 power tools and hand tools. And there's a whole slew of 151 00:07:46,840 --> 00:07:48,600 product. Every single return rate is 152 00:07:48,600 --> 00:07:51,680 different depending on the category that you're servicing. 153 00:07:51,960 --> 00:07:53,960 Of course, the largest is always going to be apparel. 154 00:07:53,960 --> 00:07:57,240 But there are things that you need to do on the front end to 155 00:07:57,240 --> 00:08:00,280 say, OK, how do I stop this? How do I mitigate this? 156 00:08:00,280 --> 00:08:03,560 Because the most important thing you can do as a business when 157 00:08:03,560 --> 00:08:08,040 you're offering the service, get a front of the consumer and find 158 00:08:08,040 --> 00:08:11,840 out how you can reduce that return and not by saying, let me 159 00:08:11,840 --> 00:08:13,680 offer you an exchange after the return occurred. 160 00:08:14,040 --> 00:08:16,440 How do I stop the return from occurring in the 1st place? 161 00:08:16,440 --> 00:08:17,920 What technology do I have to give you? 162 00:08:18,320 --> 00:08:20,400 What information do I have to give you better sizing? 163 00:08:20,600 --> 00:08:23,040 You have to create widgets for sizing across platforms. 164 00:08:23,280 --> 00:08:26,640 You have to see Bloomingdale's and Macy's and and see that the 165 00:08:26,640 --> 00:08:32,159 size of a Levi five O 1, you know 30 by 32 is the same as a 166 00:08:32,159 --> 00:08:37,039 Wrangler, you know, X with a 30 by 30. 167 00:08:37,039 --> 00:08:38,960 Is that the same? How do you create that 168 00:08:38,960 --> 00:08:41,200 technology? How do you get it adopted across 169 00:08:41,200 --> 00:08:43,080 brands? How do you get it adopted across 170 00:08:43,400 --> 00:08:46,800 retail platforms? There's a lot of this type of 171 00:08:46,800 --> 00:08:50,600 preconceived tech that lowers the return rate that the 172 00:08:50,600 --> 00:08:51,640 retailers are very interested in. 173 00:08:51,640 --> 00:08:54,920 And of course, no matter what, we live in a consumer society 174 00:08:54,920 --> 00:08:58,160 and whether it's Europe or the United States, we love the 175 00:08:58,160 --> 00:08:59,920 consumer. We're not stopping any time 176 00:08:59,920 --> 00:09:03,400 soon, tariffs or no tariffs. And I think that no matter what, 177 00:09:03,400 --> 00:09:05,400 you're going to have to deal with the physical return. 178 00:09:05,400 --> 00:09:07,120 And that's also an important part of it. 179 00:09:07,120 --> 00:09:10,040 Teaching them that walking through that is is kind of a 180 00:09:10,040 --> 00:09:12,800 mission, right? Shrink is a is a big problem in 181 00:09:12,800 --> 00:09:17,840 retail and so you know, return fraud and and how you prevent 182 00:09:17,840 --> 00:09:20,160 that. Maybe we we should unpack what 183 00:09:20,160 --> 00:09:22,720 for those who don't know what your business actually does, 184 00:09:22,960 --> 00:09:25,520 what it does, but I'm curious how it lends itself then to 185 00:09:25,520 --> 00:09:28,680 protect retailers from return fraud. 186 00:09:28,720 --> 00:09:31,440 So I think let's start with the pre purchase. 187 00:09:31,480 --> 00:09:34,240 The idea is there's three facets to return, right? 188 00:09:34,240 --> 00:09:36,480 The first is the pre purchase. What happens before? 189 00:09:36,480 --> 00:09:38,320 What leads to that return in the 1st place? 190 00:09:38,640 --> 00:09:41,440 Why did you return an item? Well, a part of it is what we 191 00:09:41,440 --> 00:09:44,880 just talked about, sizing wrong templates, just bad information 192 00:09:45,040 --> 00:09:48,120 that wasn't the customers. The customer can make a better 193 00:09:48,120 --> 00:09:50,960 decision, a more informed decision as to what they want to 194 00:09:50,960 --> 00:09:52,760 buy and they end up buying multiple items. 195 00:09:53,160 --> 00:09:55,360 The second is fraud and there's two types of fraud. 196 00:09:55,640 --> 00:09:58,520 There's organised fraud and there's something called 197 00:09:58,520 --> 00:10:01,040 wardrobing. Wardrobing, we all know, some of 198 00:10:01,040 --> 00:10:03,200 us have done it. Some of us watch our friends do 199 00:10:03,200 --> 00:10:07,080 it and they, you know, you'll buy a cocktail dress, go out and 200 00:10:07,080 --> 00:10:09,960 then you'll return that cocktail dress and and that's fraud. 201 00:10:10,080 --> 00:10:13,000 I know a lot of people think, oh, it's not, I'm doing nothing 202 00:10:13,000 --> 00:10:14,360 harmful. Well, you're doing something 203 00:10:14,360 --> 00:10:17,360 very, you bought a product under the pretence of keeping that 204 00:10:17,360 --> 00:10:20,280 item. You had no concept, no, no 205 00:10:20,280 --> 00:10:22,880 intention of keeping it. And ultimately you return that 206 00:10:22,880 --> 00:10:24,800 item. Now that retailer or that brand 207 00:10:24,800 --> 00:10:27,200 has to deal with that product, whether they have to sanitise 208 00:10:27,200 --> 00:10:29,480 it, bring it back to life, maybe it's damaged, whatever. 209 00:10:29,800 --> 00:10:32,520 It costs a lot of money, the shipping cost, handling cost, 210 00:10:32,520 --> 00:10:34,360 all that. So that's something that we have 211 00:10:34,360 --> 00:10:36,440 to deal with. And the way we deal with that as 212 00:10:36,440 --> 00:10:39,480 a business is we create these trusted customer algorithms that 213 00:10:39,480 --> 00:10:43,000 those are very, very important. And we work with other 214 00:10:43,000 --> 00:10:45,360 businesses to establish different customers across 215 00:10:45,360 --> 00:10:47,600 platforms. And then the pre purchase piece, 216 00:10:47,600 --> 00:10:50,240 I talked to you about that we make sure sizing is right and 217 00:10:50,240 --> 00:10:51,840 things of that nature. And there aren't a lot of 218 00:10:52,280 --> 00:10:55,520 players in the pre purchase. Most of the players actually 219 00:10:55,520 --> 00:10:58,080 exist in the post purchase. So to me, returns are three 220 00:10:58,080 --> 00:11:00,680 things, pre post and the physical handling of the goods. 221 00:11:00,680 --> 00:11:03,760 So the post are a lot of the businesses out there that you 222 00:11:03,760 --> 00:11:06,640 see that created the return portals because they're easy, A 223 00:11:06,640 --> 00:11:08,880 lot of the investment communities just dumping money 224 00:11:09,200 --> 00:11:11,880 into the into these portals. And there's probably 200 of 225 00:11:11,880 --> 00:11:14,440 these portal companies. The problem that I see with the 226 00:11:14,440 --> 00:11:16,520 portal company and the reason why we don't follow that 227 00:11:16,520 --> 00:11:20,480 business model we haven't for 17 years is that the portal 228 00:11:20,480 --> 00:11:23,280 community simply wants to give you a piece of software as a 229 00:11:23,280 --> 00:11:25,000 brand, as a retailer. That doesn't help. 230 00:11:25,320 --> 00:11:27,280 You need a solution of how to handle that product. 231 00:11:27,480 --> 00:11:30,120 First you need preventative measures, which is software and 232 00:11:30,480 --> 00:11:33,480 and physical. And then you need the ability, 233 00:11:33,520 --> 00:11:36,720 if the return does occur, to create that portal, to have that 234 00:11:36,720 --> 00:11:38,320 technology. The returns regions, the 235 00:11:38,320 --> 00:11:40,240 exchanges, the trusted customers, the keypad 236 00:11:40,240 --> 00:11:42,320 algorithms, all those things are important. 237 00:11:42,520 --> 00:11:45,000 But then what happens when the physical item gets returned, 238 00:11:45,000 --> 00:11:49,120 $200 billion of the $900 billion is spent. 239 00:11:49,560 --> 00:11:52,120 So on 900 billion or approximately 900 billion of 240 00:11:52,120 --> 00:11:55,480 returns, 200 billion is spent on supply chain dollars when the 241 00:11:55,480 --> 00:11:58,320 recovery as a whole is about 133 billion. 242 00:11:58,600 --> 00:12:01,880 So they're underwater, that 66 billion, meaning that if you 243 00:12:01,880 --> 00:12:04,600 took the returns and put them in the garbage, you would be 244 00:12:04,600 --> 00:12:06,640 financially better off. Of course, that's not an 245 00:12:06,640 --> 00:12:07,760 alternative. It's not good for the 246 00:12:07,760 --> 00:12:10,320 environment, it's not good for the retail, it's not good for 247 00:12:10,320 --> 00:12:12,640 anybody. But the money is really going to 248 00:12:12,640 --> 00:12:14,080 these transport companies, right? 249 00:12:14,320 --> 00:12:17,240 The FedEx is the DHL is the UPS because they're moving the 250 00:12:17,240 --> 00:12:20,280 product from place to place. So solving returns, solve the 251 00:12:20,280 --> 00:12:24,440 pre, avoid the return if you can't take the return, create 252 00:12:24,440 --> 00:12:27,040 the technology, but then physically handle the product to 253 00:12:27,040 --> 00:12:30,080 bring the product back to life. That's such an important part of 254 00:12:30,080 --> 00:12:31,560 the journey. And I get passionate about it, 255 00:12:31,560 --> 00:12:33,120 you know, because it's what we do. 256 00:12:33,120 --> 00:12:35,880 And I love this piece and explaining it to people like, 257 00:12:35,920 --> 00:12:38,800 oh, doesn't the product just go automatically back on the shelf? 258 00:12:39,040 --> 00:12:43,120 Sure, for things like clothing, about 90% of it can go back on 259 00:12:43,120 --> 00:12:46,000 the shelf, but it still needs to go to the supply chain and touch 260 00:12:46,000 --> 00:12:47,960 by person. But for some categories that 261 00:12:47,960 --> 00:12:51,680 have privacy issues, like data privacy, like electronics, less 262 00:12:51,680 --> 00:12:55,320 than 4% go back on the shelf. That's a mind boggling number. 263 00:12:55,480 --> 00:12:58,680 That means 96% has to be touched by humans before they're 264 00:12:58,680 --> 00:12:59,720 allergies. Where are you going to touch 265 00:12:59,720 --> 00:13:02,160 them? A $20 Roku Stick is not worth 266 00:13:02,160 --> 00:13:04,960 touching in the United States. You have to plug it in, you have 267 00:13:04,960 --> 00:13:06,720 to data wipe it, you have to test it. 268 00:13:06,920 --> 00:13:08,920 These are very expensive things. So you have to have those 269 00:13:08,920 --> 00:13:12,000 economies of scale on top of that supply chain industry. 270 00:13:12,160 --> 00:13:15,360 We have 11 facilities in, in, in 8 facilities in the United 271 00:13:15,360 --> 00:13:19,640 States, two in Canada, 2 in Mexico, one in Southeast Asia, 272 00:13:19,800 --> 00:13:21,080 just to bring that back and forth. 273 00:13:21,160 --> 00:13:24,440 We're a small company, Yeah, you know, it's like 3.7 million 274 00:13:24,440 --> 00:13:26,640 square feet. Just working on the 275 00:13:26,640 --> 00:13:29,120 functionality of bringing the product back to life. 276 00:13:29,360 --> 00:13:31,600 So we're not just a software company, we're not just 277 00:13:31,600 --> 00:13:34,360 technology company, we're not just a re commerce company. 278 00:13:34,600 --> 00:13:38,280 We are all those things because our goal is for you as a 279 00:13:38,280 --> 00:13:40,600 retailer, as a brand, to take that product and put it back on 280 00:13:40,600 --> 00:13:43,200 your marketplace. No, that's OK. 281 00:13:43,240 --> 00:13:47,080 You mentioned 2 important points that I just want you to sort of 282 00:13:47,440 --> 00:13:49,960 take us through. One of them is your trusted 283 00:13:49,960 --> 00:13:54,400 customer algorithm and how you know, low cost items, you may, 284 00:13:54,720 --> 00:13:58,120 because you trust them, there's a trust element in there. 285 00:13:58,320 --> 00:14:00,760 And so therefore, you know, keep, keep the product if it's, 286 00:14:00,960 --> 00:14:03,360 it's, if it's meet certain metrics. 287 00:14:03,600 --> 00:14:06,840 And then how are you reducing products from going to landfill 288 00:14:06,840 --> 00:14:09,560 like the Roku example? I'm just thinking, does the 289 00:14:09,560 --> 00:14:12,000 model say, well, don't touch it, just throw it away? 290 00:14:12,120 --> 00:14:14,840 So I'm just curious, how are you specifically help in those 291 00:14:14,840 --> 00:14:17,440 areas? So it starts with really good 292 00:14:17,440 --> 00:14:19,400 tech. I think trusted customer 293 00:14:19,400 --> 00:14:21,400 algorithms, the bigger the retailer, the less they're going 294 00:14:21,400 --> 00:14:23,800 to let us handle it. I think the larger enterprise 295 00:14:23,800 --> 00:14:28,040 retailers, we work with them a lot and we help them provide 296 00:14:28,040 --> 00:14:30,640 information about their trusted customer algorithm for 297 00:14:30,640 --> 00:14:34,480 themselves, but they have their own and our job within the 298 00:14:34,480 --> 00:14:37,840 supply chains to feed that data back customer X particles 299 00:14:37,840 --> 00:14:40,000 received. It wasn't as described, it 300 00:14:40,000 --> 00:14:42,600 wasn't the right product. Don't trust the customers more. 301 00:14:42,800 --> 00:14:45,600 Ding their, their, their lifetime value by X amount of 302 00:14:45,600 --> 00:14:49,960 dollars and make sure that that LTV ends up being, you know, 303 00:14:50,600 --> 00:14:53,160 decremented by X amount. And if it's below a certain 304 00:14:53,160 --> 00:14:55,760 threshold, then don't trust the customer anymore. 305 00:14:55,760 --> 00:14:59,000 And that's kind of how most of the algos work for the small, 306 00:14:59,320 --> 00:15:02,640 for the smaller and medium sized businesses, we of course provide 307 00:15:02,640 --> 00:15:05,160 that for them. The second part, which is just 308 00:15:05,160 --> 00:15:08,160 as important, which is that example of a Roku stick or 309 00:15:08,160 --> 00:15:09,680 something as simple as a Stanley mug. 310 00:15:09,680 --> 00:15:11,760 You know, Stanley mug doesn't have a lot of proprietary 311 00:15:11,760 --> 00:15:13,240 technology. It's a brand, it's something 312 00:15:13,240 --> 00:15:15,440 very cool. It's a piece of stainless steel 313 00:15:15,640 --> 00:15:20,280 and it's fairly easy to to to run a very rigorous supply chain 314 00:15:20,600 --> 00:15:23,080 operation on it, make sure it's sanitised and put it back into 315 00:15:23,080 --> 00:15:25,000 the marketplace. But where would you do that? 316 00:15:25,000 --> 00:15:28,040 It's a 1520 thirty dollar item. You're not going to do that in 317 00:15:28,040 --> 00:15:33,280 the United States at an average labour cost of $2223 loaded. 318 00:15:33,280 --> 00:15:37,680 You're going to go into a a market where that that economy 319 00:15:37,680 --> 00:15:39,880 of scale makes sense. So maybe you're going to go to 320 00:15:39,880 --> 00:15:44,080 Mexico if it's a less expensive item with less technology, Maybe 321 00:15:44,080 --> 00:15:46,720 you're going to go to Southeast Asia where you're going to put 322 00:15:46,720 --> 00:15:50,360 some more work into it and bring it back like maybe into Canada. 323 00:15:50,360 --> 00:15:53,240 And that's why we have these facilities and dots because that 324 00:15:53,240 --> 00:15:55,920 technology is important. That algo that we have reads 325 00:15:55,920 --> 00:15:58,360 that information. It uses some basic machine 326 00:15:58,360 --> 00:16:00,200 learning. There's a bunch of agents that 327 00:16:00,200 --> 00:16:03,680 we have that are built across that from categories to price to 328 00:16:03,680 --> 00:16:07,520 customer sentiment to all that, that work and understand what 329 00:16:07,520 --> 00:16:09,280 the value of the item is going to be at the end. 330 00:16:09,280 --> 00:16:12,440 Because we run our own supply chain, we know that what the ERP 331 00:16:12,480 --> 00:16:15,240 costs or what the management cost of touching that product is 332 00:16:15,240 --> 00:16:17,200 going to be throughout the life cycle of the item. 333 00:16:17,240 --> 00:16:19,880 And we put all that data together and say, OK, hot dog, 334 00:16:19,880 --> 00:16:21,600 no hot dog. You know, at the end of the day, 335 00:16:21,880 --> 00:16:25,720 that's where it ends up and it it it sends it to the right 336 00:16:25,720 --> 00:16:28,400 channel. Our goal is to make sure nothing 337 00:16:28,400 --> 00:16:31,160 ends up in the liquidation pallet, nothing ends up in 338 00:16:31,160 --> 00:16:32,760 landfill. We want to bring that product 339 00:16:32,760 --> 00:16:34,920 back to life and give it to the original Brett. 340 00:16:35,240 --> 00:16:38,000 But sometimes these brands don't have that technology. 341 00:16:38,200 --> 00:16:41,600 They can't even take refurb or secondary market products onto 342 00:16:41,600 --> 00:16:43,720 the marketplace. So we start off by helping them 343 00:16:43,720 --> 00:16:47,720 sell it on other marketplace and ultimately over over the years 344 00:16:47,720 --> 00:16:50,080 we work with them to create their own secondary market 345 00:16:50,080 --> 00:16:53,760 platform right on their websites and they we can resell that 346 00:16:53,760 --> 00:16:55,640 product within their environment, attract that 347 00:16:55,640 --> 00:16:58,360 secondary market customer. And it also gives something very 348 00:16:58,360 --> 00:16:59,560 important which you didn't mention. 349 00:16:59,560 --> 00:17:03,280 And I think we'll get to there's a huge brand protection element. 350 00:17:03,880 --> 00:17:07,160 You don't want to see your product being sold in in 351 00:17:07,160 --> 00:17:11,440 countries where the return rate in the in the United States is 352 00:17:11,440 --> 00:17:15,119 bigger than the entire reset and then the entire forward sales of 353 00:17:15,119 --> 00:17:16,839 that product. Then you can take, you know, 354 00:17:16,839 --> 00:17:21,440 computers like Lenovo, HP, Dell, or even simpler stuff like TTI 355 00:17:21,599 --> 00:17:24,720 that has Milwaukee brand and, and other brands that are Black 356 00:17:24,720 --> 00:17:26,200 and Decker and things of that nature. 357 00:17:26,480 --> 00:17:30,000 If you take that product and export into smaller markets, the 358 00:17:30,000 --> 00:17:33,440 returns volume could be bigger than your forward volume and it 359 00:17:33,440 --> 00:17:36,720 could truly disrupt that brand. So we work with those brands to 360 00:17:36,720 --> 00:17:39,880 make sure that you're not your product doesn't end up in those 361 00:17:39,880 --> 00:17:42,880 in those those places. One of the things that we used 362 00:17:42,880 --> 00:17:46,400 to anecdotally say, which it sounds like there's data behind 363 00:17:46,400 --> 00:17:50,480 it, is the fact that your returns policy is now going to 364 00:17:50,480 --> 00:17:55,360 dictate your sales ability because customers actually care 365 00:17:55,880 --> 00:17:58,960 about the returns policy and they make their decisions on it. 366 00:17:58,960 --> 00:18:04,200 And your research showed that 77% of shoppers factored that 367 00:18:04,200 --> 00:18:06,120 in. I'm just curious what like the 368 00:18:06,120 --> 00:18:10,080 one or two things that you find that consumers or shoppers are 369 00:18:10,080 --> 00:18:13,600 looking for from a returns policies that retailers really 370 00:18:13,600 --> 00:18:16,880 need to pay attention to? I think there's a trend out 371 00:18:16,880 --> 00:18:19,760 there right now with returns insurance which they charge a 372 00:18:19,760 --> 00:18:23,200 customer or maybe the brand pays for it upfront to ensure the 373 00:18:23,200 --> 00:18:26,360 package on the way back they basically ensuring the shipping 374 00:18:26,360 --> 00:18:29,120 of the item back. I think ultimately over time the 375 00:18:29,120 --> 00:18:32,560 consumers going to speak and consumer wants ease ability of 376 00:18:32,560 --> 00:18:34,760 purchase. They don't want they want very 377 00:18:34,760 --> 00:18:37,880 transparent return policies. They don't want to know that 378 00:18:37,960 --> 00:18:40,240 they didn't pay for some insurance and now they have to 379 00:18:40,240 --> 00:18:42,680 pay for shipping. They don't mind being directed 380 00:18:42,680 --> 00:18:45,520 to drop off locations. They also don't want to walk 381 00:18:45,520 --> 00:18:47,520 into supply chain drop off locations. 382 00:18:47,920 --> 00:18:50,560 So what they're looking for is a better shopping experience. 383 00:18:50,800 --> 00:18:55,440 So if I bought my item online, you know, at a Walmart, I want 384 00:18:55,440 --> 00:18:58,320 to come back to a Walmart to return it or maybe another 385 00:18:58,320 --> 00:19:00,440 retail where I'm going to enjoy spending that money again. 386 00:19:00,960 --> 00:19:03,680 And that's OK. If you charge me for an H&M item 387 00:19:03,960 --> 00:19:07,440 and you say if, if, if I'm not going to walk into an H&M store 388 00:19:07,440 --> 00:19:10,320 and return it at an H&M store, maybe I'm going to get charged 389 00:19:10,320 --> 00:19:13,040 $2.75 for shipping it. That's fair. 390 00:19:13,520 --> 00:19:17,400 But if you're strictly a.com reseller, I suggest that brands 391 00:19:17,400 --> 00:19:19,360 don't do that. That's a very bad idea. 392 00:19:19,640 --> 00:19:21,760 And that's a very bad idea because they're going to 393 00:19:21,760 --> 00:19:23,560 alienate their customer. The customer is not going to 394 00:19:23,560 --> 00:19:26,320 want to pay those fees. And I think over time the model 395 00:19:26,320 --> 00:19:28,760 is going to prove itself out. You know, convenience always 396 00:19:28,760 --> 00:19:31,760 right from from Sam Walton to Jeff Bezos, customers always 397 00:19:31,760 --> 00:19:33,760 right the light and excite the customer. 398 00:19:33,760 --> 00:19:35,440 That's the single most important thing. 399 00:19:35,760 --> 00:19:37,800 And that's our goal. Although our customers, the 400 00:19:37,800 --> 00:19:40,680 retailer and the brand and the vendor, we make sure that we 401 00:19:40,680 --> 00:19:43,880 follow that ethos that they have, which is really, really 402 00:19:43,880 --> 00:19:46,880 delighting those customers. I got your final question. 403 00:19:47,080 --> 00:19:49,920 When you look to the future, given everything that's going 404 00:19:49,920 --> 00:19:52,000 on, how do you see this world evolving? 405 00:19:52,120 --> 00:19:55,280 I think that returns are the most complex part of the 406 00:19:55,280 --> 00:19:57,800 ecosystem. I think what you find is the 407 00:19:57,800 --> 00:20:00,840 retailers avoid it and it's kind of like the black sheep as I 408 00:20:00,840 --> 00:20:03,320 described at the beginning of our conversation, because it's 409 00:20:03,320 --> 00:20:06,360 so complex. Normal enterprise retailers are 410 00:20:06,360 --> 00:20:08,240 departmentalized, right? There's a supply chain 411 00:20:08,240 --> 00:20:10,120 department, transportation department, there's a retail 412 00:20:10,120 --> 00:20:12,880 department, branding department, merchandising department, and 413 00:20:12,880 --> 00:20:15,800 all these departments don't really communicate so well 414 00:20:15,800 --> 00:20:19,280 amongst themselves and returns, unfortunately, it touches every 415 00:20:19,280 --> 00:20:22,520 facet of it, right? Even the way merchandiser 416 00:20:22,520 --> 00:20:24,640 negotiate. With the brand is important 417 00:20:24,640 --> 00:20:27,320 because that return policy is set right then and there. 418 00:20:27,320 --> 00:20:31,360 So I think the first and foremost in the future as the 419 00:20:31,440 --> 00:20:35,400 enterprise retailers and the executive staff really start 420 00:20:35,400 --> 00:20:38,080 understanding the impact of returns and they want those 421 00:20:38,080 --> 00:20:40,720 dollars or percentage points back on their Net margin, 422 00:20:40,880 --> 00:20:43,160 they're going to start to tie that thread together. 423 00:20:43,160 --> 00:20:45,640 Maybe they'll have a chief returns officer, maybe they'll 424 00:20:45,640 --> 00:20:48,520 have an executive of returns. That's a really important part 425 00:20:48,520 --> 00:20:50,600 of the future. Additionally, I think machine 426 00:20:50,600 --> 00:20:53,840 learning plays a huge part. I think what we do is extremely 427 00:20:53,840 --> 00:20:58,800 complex and we've started, you know, really letting some some 428 00:20:58,800 --> 00:21:02,880 agents help us out in smaller areas of the returns ecosystem, 429 00:21:02,880 --> 00:21:07,520 buying this very complex threshold together and, and 430 00:21:07,520 --> 00:21:11,200 asking a machine to make a decision that would take a human 431 00:21:11,200 --> 00:21:15,840 being on maybe 100 million UPC's, you know, months to make 432 00:21:15,840 --> 00:21:19,120 and run a bunch of algorithms and have a lot of mistakes that 433 00:21:19,120 --> 00:21:21,760 come out of the end in terms of how you disposition these items 434 00:21:22,000 --> 00:21:25,040 is always easier than than having a human. 435 00:21:25,040 --> 00:21:27,720 So I mean, that's the real disruption here. 436 00:21:27,720 --> 00:21:30,280 It's a machine that can thread all those things together and 437 00:21:30,280 --> 00:21:33,720 the understanding of the C staff level that we need this, that we 438 00:21:33,720 --> 00:21:37,440 have to solve this and that kind of buy in is what we've been 439 00:21:37,440 --> 00:21:39,480 excited about. That's why the last 16 years 440 00:21:39,480 --> 00:21:42,960 were fun, 1617 years. The next 16-17 years are going 441 00:21:42,960 --> 00:21:45,920 to be more fun. Sure they are again. 442 00:21:46,040 --> 00:21:47,960 Yeah. Anyway, onwards and upwards as 443 00:21:47,960 --> 00:21:50,240 they always say. Sandra, thank you so much for 444 00:21:50,240 --> 00:21:52,600 giving out. Carving some time out for us. 445 00:21:52,720 --> 00:21:54,440 Will you be a shop talk? I will. 446 00:21:54,440 --> 00:21:55,120 I will. OK. 447 00:21:55,240 --> 00:21:56,960 Look forward to come. I'll come and say hi. 448 00:21:57,440 --> 00:21:59,240 Yeah, looking forward to meeting you in person. 449 00:21:59,600 --> 00:22:01,480 Thank you very much, Sandra. Thank you.