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Old October 10, 2002, 12:13 PM
Eve
 
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Default Question about % of returns

I've followed the thread below about return rates and the information provided was excellent. But one factor has me puzzled and it wasn't addressed in that thread.

Why does the RATE of return rise when volume rises? I can understand why the NUMBER of returns would rise but not why the rate would.

For example, a product has been steadily selling at about 100 units per month, with a consistent rate of 3-4 returns per month. Let's say a new marketing strategy increases sales by a factor of 5. i.e., to 500 per month. Wouldn't the number of returns increase to 15-20 per month, reflecting the established return rate (or something very close to it)?

Is there some economic/business factor that would raise the rate higher? Does anyone know? I'm sure more than a few of us would be interested in learning the answer.

Thanks much...
Eve §:)
 


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