Josh Camacho
Bungii | Chief Operations Officer
Every operation has a pressure point that drains margin. For most, it’s reverse logistics.
Returns look small on paper but create ripple effects through every part of the network. In 2024, an estimated 24.6% of eCommerce orders were returned, the highest rate ever recorded, underscoring how costly and common reverse logistics has become for retailers.
Most teams know returns are expensive. Few can tell you why. The root problem is visibility. Reverse logistics doesn’t get the same attention or measurement as outbound. When that happens, decisions turn reactive and small issues compound into big losses.
The good news is that reverse logistics can be managed with the same precision as the rest of the operation. It starts with tracking the right data. These five metrics expose where value is lost and where control can be gained.
1. Cost Per Return
Every return costs more than what you see on the balance sheet.
The carrier invoice only tells part of the story. Real cost includes rehandling, inspection, storage, and the time it takes to process a refund. Add those together and the number often doubles.
Tracking cost per return gives leaders a clear view of where the process breaks down. Once you see the true cost, you can find patterns. Maybe one product line drives most of the waste. Maybe certain carriers require extra handling. The data doesn’t solve the problem on its own, but it tells you where to focus.
2. Cycle Time
Speed matters as much on the way back as it does on the way out.
Cycle time measures how long it takes to move a return from pickup to resolution. Every day that product sits in limbo is value locked up in inventory and labor.
Fast resolution keeps customers confident and warehouses clear. Slow resolution drags both down.
Reducing cycle time doesn’t require new technology so much as better coordination. When customer support, carrier scheduling, and warehouse teams move in rhythm, returns stop stacking up and costs fall.
3. Asset Recovery Rate
Not all returns are losses. Some can still create value if the operation is built for it.
Asset recovery rate tracks how much product you reclaim through resale, refurbishment, or donation. It shows whether the business treats returns as waste or as an asset that still has life left.
Big and bulky products make this metric matter even more. A reclaimed sofa or palletized equipment load can mean thousands in recovered margin. Improving this number usually starts with ownership. Someone has to be responsible for identifying what can be saved and moving it quickly.
4. Customer Retention Impact
A return is more than a logistics event. It’s a test of trust.
By the time someone asks to send a product back, frustration has already built. What happens next decides whether that relationship survives. Measuring how return experience connects to reorder rate or satisfaction score helps operations see their role in retention.
At Bungii, we’ve seen that customers who describe their return process as simple are far more likely to do business again. They remember how easy the fix was, not that something went wrong. Fast, clear communication in this moment matters as much as the delivery itself.
5. Carrier Performance Consistency
Reverse logistics lives or dies on carrier performance. One partner can make the process seamless. Another can undo weeks of good work.
Carrier performance consistency tracks on-time pickups, damage incidents, and SLA accuracy across return partners. It shows who’s dependable and who introduces risk.
The goal is predictability, not perfection. When carriers deliver consistent results, operations can plan capacity, manage timelines, and keep customers informed. That consistency builds stability across the network.
Why Reverse Logistics Metrics Matter
Reverse logistics will always be complex. There are moving parts, competing priorities, and pressure from both customers and finance. But complexity isn’t an excuse for blind spots. Measurement creates control.
Most companies still separate reverse logistics from the rest of the operation. Outbound gets attention, tools, and budget. Returns get workarounds and manual reporting. That disconnect causes more damage than most leaders realize. A late pickup or damaged return doesn’t just impact that order—it pulls labor off priorities, creates rework, and leaves finance guessing at the true impact.
But the divide is shrinking. As retail supply chains handle larger, bulkier items, reverse logistics is becoming a core performance driver instead of an afterthought. FreightWaves notes that “big and bulky” categories are reshaping what efficient fulfillment looks like, and returns from those same categories are adding new pressure across the network.
Visibility changes that. When cost per return, cycle time, and recovery rates are tracked consistently, teams start working from the same facts. Finance can forecast costs instead of estimate. Warehouse managers can plan staffing before volume hits. Carrier teams can hold partners to clear standards instead of chasing complaints.
The best operators don’t treat reverse logistics metrics as a dashboard exercise. They use them to test how disciplined their operation really is. When you measure this side of the business, you see how your entire system handles pressure. If returns are slow or inconsistent, the same habits are hiding elsewhere.
Metrics reveal what work needs ownership. They make process health visible and give teams the confidence to manage problems early instead of chasing them later.
How to Improve Reverse Logistics and Build Control
Reverse logistics used to be the forgotten part of the supply chain. It was treated like a cleanup job that happened after the real work was done. That thinking is what keeps operations reactive instead of predictable.
Today, returns shape margin, customer loyalty, and brand reputation. They’re not an afterthought. They’re a core part of performance. The teams that manage reverse logistics with intention can see problems early, recover more value, and build stability across the network.
The returns problem isn’t just financial. It’s environmental. Forbes estimates that unsustainable returns could represent an $890 billion blind spot for retailers, combining wasted product, higher emissions, and lost customer goodwill.
Improving reverse logistics starts with measurement. Tracking the five core metrics of cost per return, cycle time, asset recovery rate, customer retention impact, and carrier performance consistency gives you a clear view of what is working and what needs attention.
- Make cost visible. Know what each return really costs, including labor, storage, and processing. Visibility here exposes waste and sets the baseline for improvement.
- Shorten cycle times. The faster a return moves through your system, the less it costs. Fast resolution frees up labor, space, and cash flow.
- Recover value. Treat returned goods as assets. Resell, refurbish, or donate what can be recovered instead of defaulting to disposal.
- Protect the customer. A return that feels simple and fair keeps buyers confident. Returns that drag create churn.
- Demand consistency. Hold carriers and partners to measurable service standards. Consistency in reverse builds trust throughout the operation.
These tactics create rhythm and accountability. Once teams track these metrics, they can stop chasing isolated fixes and start managing a connected system.
The best operators see reverse logistics as proof of discipline. They understand that control does not come from software or size. It comes from running the same process, the same way, every time, even when volume increases or conditions shift.
Reverse logistics will always be complex, but complexity is manageable when you measure what matters. Control starts with clarity.
