13 Returns Logistics

This chapter provides an overview of the Returns Logistics or Returns Optimization capabilities available.

Overview

The Returns Logistics process takes data inputs such as price, inventory, shipping costs, price ladders, sales, and returns information and passes them into a scientific algorithm that makes recommendations about products that have been returned. These recommendations include where to ship them from, where to ship them to, and in what quantities.

The bulk of the processing occurs outside of the database; however, the correct data must be in place in order for the algorithm to produce meaningful output. Internal database processes reside in the application in order to serve the data to the external algorithm.

The Returns Logistics process runs weekly as a batch process for products in the top x selling categories, where x is a database configuration parameter stored in the RSE_CONFIG table.

Data Inputs

The Returns Logistics process uses data from both RI and ORASE databases. Price, inventory, sales, and returns data are all pulled directly from the RI database before being served to the external algorithm. The configuration parameters for the process are stored in ORASE. For example, the process can be executed on the value for the parameter Top Selling Categories. The data for the top selling categories (which in turn determine the subset list of products), resides solely within the application. Price ladders, shipping costs, and price elasticity are all data sources provided directly within the application.

Table 13-1 Data Inputs

Data Input	Source Database	Source Table
Current Price	RI	W_RTL_PRICE_IT_LC_G
Regular Price	RI	W_RTL_PRICE_IT_DY_F
Inventory	RI	W_RTL_INV_IT_LC_G
Sales	RI	W_RTL_SLS_IT_LC_WK_A
Returns	RI	W_RTL_SLS_IT_LC_WK_A
Season	RI	W_RTL_SEASON_D
Season Products	RI	W_RTL_SEASON_IT_D
Product	RI	W_PRODUCT_D
Calendar	RI	W_MCAL_DAY_D, W_MCAL_WEEK_D
Shipping Costs	ORASE	RL_SHIPPING_COST
Price Ladder	ORASE	RL_PRICE_LADDER
Price Elasticity	ORASE	RL_PRICE_ELASTICITY
Top Selling Categories	ORASE	RSE_SLS_PH_LC_WK_A
Calendar Hierarchy	ORASE	RSE_CAL_SRC_XREF
Product Hierarchy	ORASE	RSE_PROD_HIER_TC, RSE_PROD_SRC_XREF
Location Hierarchy	ORASE	RSE_LOC_SRC_XREF

Data Outputs

The external algorithm of the Returns Logistics process writes recommendations back into the application database. Database tables are written to that provide shipping recommendations (for a quantity of product from location to location) and also the optimal demand and revenue of a product at a location.

These recommendations answer the question "What should be done with the products that have been returned?" Answers include shipping them from one store to another where demand may be higher.

Table 13-2 Data Outputs

Data Output	Database	Table
Shipping Recommendation	ORASE	RL_SHIPPING_RECOMMENDATION
Optimal Demand	ORASE	RL_OPT_DEM_REV

In addition to the tables, two corresponding database views are provided that can be used as the basis for an export process for example, to RI) as required.