Startup interview: Haider Abdo, CEO and Founder, Returnado
RTIH gets the lowdown on Returnado, a Swedish startup that focuses on the e-commerce returns process.
RTIH: Tell us about Returnado
HA: Returnado’s bespoke cloud-based offerings streamline many of the cumbersome administrative processes typically associated with returns.
While retailers receive help with customer support, warehouse management and other logistical needs, consumers are provided with a fast and seamless means by which to schedule and track returns, and also navigate product exchanges.
It is also no secret that retail returns can have a lasting impact on the environment in terms of both carbon emissions from transportation and unwanted goods that end up in landfill.
As such, we believe we have a responsibility to promote sustainable practices across the entirety of our clients’ returns journey.
As well as making the process less arduous on the consumer end, thereby increasing the likelihood of them actually returning products, our technology also enables retailers to assess a product’s condition before it is returned.
A decision can therefore be made on whether it should be returned, partially refunded, sent for repair, or if it can be disposed of locally and sustainably.
RTIH: What was the inspiration behind setting the company up?
HA: During my time working as a digital specialist at a leading Nordic media agency, I was tasked with providing consultancy to a number of clients in the retail space.
Through this, I became acutely aware of a critical problem in the industry that had been growing exponentially but that had yet to have been addressed.
Despite the fact that almost half of all products purchased online were subsequently being returned, I realised that very little attention was being paid to this last part of the e-commerce journey.
Any processes that were in place tended to be technically underdeveloped, particularly when compared to other retail touchpoints, and often comprised of an amalgamation of non-optimised systems, making it a horrible experience for the customer.
It was from here that Returnado was born in order to help retailers treat returns as a natural part of the e-commerce journey.
RTIH: What has been the industry reaction thus far?
HA: The industry is very much in agreement that the returns aspect of the e-commerce journey is a problem that affects every part of their business, and one that affects consumers as well as merchants.
As returns, historically, haven’t been a focal point when it comes to retail tech innovation, there are very few SaaS solutions out there getting to the heart of the issue.
What’s more, siloed working within the industry has resulted in a vast knowledge gap whereby vital communication across departments is not taking place, and this is all happening at the cost of retailers’ bottomline.
Given the scale of the problem, there is clear value in solving it but for the many retailers attempting to quantify the potential value, and subsequently developing solutions that help realise this value, it remains a tough nut to crack.
This is where we come in, using our experience and know-how to help retailers all around the world address their returns process in a way that works for them and their customers.
With a 90% reduction in administration and the ability to recover one-third of all revenue originally lost, it is hardly surprising that our clients consistently say to us things like: “We should have done this years ago” or “Why haven’t we been working like this until now?”
RTIH: What has been your biggest challenge/setback?
HA: Our biggest challenge to date remains the need to educate our customers and their teams on the full extent of their returns problem, the potential unlocked value, and therefore the importance of transforming the returns process.
Though this does tend to vary depending on the country the merchant is in and the size of the market.
RTIH: What's the best question about your company or the market asked of you recently by an investor?
HA: What do you do when Amazon has a global monopoly? This question demonstrated to us the differing ways in which the e-commerce market is viewed across the world.
Where some markets we work in are being devoured by Amazon, others see e-commerce platforms such as Shopify, Alibaba and Tencent growing exponentially
Today, Amazon holds market dominance in North America as well as larger European markets like Germany and France.
Meanwhile, many parts of Europe and Asia have their own ecosystems of both mono-brands (selling their own items) and multi-brand retailers (selling the products of others).
The success of the latter is dependent on a multitude of different hyper-focused suppliers segmented on everything from payments and recommendations, to returns.
Some tech suppliers see Amazon’s growth as a great opportunity to help brands and merchants who need help competing with Amazon’s technical lead. Others see it as the end of the non-monopolistic market.
RTIH: And by a customer?
How can we become sustainable without adding bureaucracy and without reducing our customer value?
Usually, when we talk to merchants about sustainability, it’s often treated as a side project that needs to be factored in somehow, as opposed to a core part of their overall business model.
This means sustainable practices usually have an aura of providing limited added value and thus is seen within the company to be damaging to either the customer experience or the economic profitability of the business.
This question has been pivotal in helping us to refine our offering and has provided a foundation from which to update our code of best practice as a way to help merchants learn how to be more sustainable, without needless bureaucracy.
We achieved this by: reducing unnecessary returns; limiting the number of unnecessary shipments of items that typically end up in landfill sites; reducing operational mistakes that lead to unnecessary returns
Enhancing the exchange process to limit “multiple-variant” purchases whereby consumers buy the same product in different sizes, for example; offering incentives to drive consumers to think and act more sustainably without reducing the overall customer experience; providing data insights that help retailers make better decisions quicker.
RTIH: What will be the impact of Brexit on the returns process for brands and consumers?
HA: The main impact will be an increase in friction points such as tax hikes, hold-ups at customs, and even surprise additional costs for both parties.
This, in turn, will slow things down greatly and may even result in further inefficiency.
With these extra fiction points, prices of goods are likely to increase in order for brands to compensate and this will either hit consumers directly, or result in EU-based merchants losing out to their UK competitors who are able to charge less for the same thing.
What’s more, unless retailers have prepared for Brexit properly, the onus of the returns process for goods from outside of the UK is likely to also become more weighted towards the consumer in the short-term, as the need to export unwanted goods will require a customs declaration and potentially extra costs.
In addition, consumers are likely to experience slower handling of refunds and exchanges.
All this will undoubtedly have an impact on consumer willingness to return unwanted goods, resulting in them being out of pocket and even an increase in items ending up in landfill.
I think we can expect some non-UK based smaller or niche brands to limit their sales effort to the UK until a formal agreement with the EU is signed.
But it’s not all doom and gloom. For now, here’s how brands can get a head start:
● Gather relevant items data. Do any specific rules apply to your products?
● Make sure that you have sent a customs handling authorization to your customs agent (if applicable)
● Stay up-to-date with negotiations between the UK and EU
● Invest in your returns management process in order to save time, money and preserve customer satisfaction.
RTIH: What can we expect to see from Returnado over the next 12 months?
HA: With a presence in more than 70 countries, we already have a global footprint but we’re aiming to further expand our reach this year in order to support customers in more markets.
To this end, we also plan to continue growing our team and attract great talent to help us along the way.
We are also constantly working to develop our technology to better meet the changing needs of our clients, so stay tuned.
