Return to origin (RTO) is a common term in e-commerce portals. If a package is not delivered due to some reason, RTO is initiated, and the package is sent back to the seller. Let us understand what RTO means in courier service? When you purchase something online, the seller sends your package through a courier agency. If the courier agency is not able to deliver the package due to the non-availability of the recipient, it is returned back to the seller. The higher the number of RTO’s generated, the higher is the expenditure borne by the seller. It is thus understandable that a low RTO rate is better as far as business prospects are concerned.
What are the main reasons for the non-delivery of packages?
There may be numerous reasons for the non-delivery of packages, some of which are enlisted below:
- The package is not delivered due to non-availability of the customer.
- The buyer’s address or other relevant information is incorrect.
- The premises are closed.
- The customer does not receive the package
- Re-attempt at delivery of package fails.
In case any of the above occurs, the process of RTO is initiated. But a certain protocol is followed before the process of RTO is begun. If the courier agency is not successful in delivering the package to the buyer, it generates a not-delivered status. Once this is done, the following course of action is followed:
- The courier services re-attempt the delivery at least three times.
- A call is made to the customer by the courier or the seller to ask the suitable time of delivery.
- The customers also get an IVR call or a text message to confirm whether they want to receive or decline the package.
- If the customer cannot be reached by either way, an RTO is generated.
- The courier services then send the package back to the seller at his registered address.
Usually, the courier services attempt to deliver the package multiple times and try to contact the buyer, but if for some reason the package remains undelivered, it is marked as RTO and shipped back to the seller.
The courier service and the seller usually have a mutual contract regarding the process of return of packages marked as RTO. The seller has to bear the shipment charges levied on such shipments. Some sellers incorporate these shipping margins in the price of the product itself so that their business is not hampered. To avoid losses on account of RTO, the seller needs to monitor the buyer’s behavior and use a reliable courier agency.
RTO is one of the most important aspects when you consider maximizing your profitability. An undelivered package is never an appealing sight for the seller as it adversely affects the profit margin. There are chances of losing customer trust if this is coupled with a poor return policy. Therefore, it is imperative to employ a trustworthy courier partner who genuinely re-attempts to contact the customer and deliver the package. The courier service should ensure that the RTO process is initiated only when absolutely necessary.