ZigZag Global is a technology platform to help retailers manage and resell returned stock without the need for return to the retailer. ZigZag plans to offer:
- Local returns addresses to multiple warehouses worldwide
- Intelligent returns web portal (mobile friendly)
- Cash recovery on returns
- Goods refulfilled to next order for the same item
- Cost controlled postage labels
- Goods are graded and resold via marketplaces
- Returns routed intelligently to where the goods will sell best
- Bulk consolidation and transportation
- Customer Service and translation if required
- Returns address for undelivered items
ZigZag is a managed international returns service to help retailers re-sell stock instead of return stock. In our experience, retailers want sales and cash recovery, not returns! The ZigZag returns web portal can be easily white labelled and integrated into a retailer’s own website to enable your customers to print out a simple cost controlled label to send the goods back to a local ZigZag warehouse. Our labels are intelligently produced to help save money on postage but also create sales, so we’ll aim to redirect the return to the place where it has the highest propensity to sell. Return solutions can include any number of courier partners and services such as standard parcels, post shop, lockers or collection services as required.
The ZigZag web portal will also includes payment options, such as PayPal, or the retailer can elect to offer free returns or even deduct the returns cost from the refund upon receipt of the goods. The return label cost can be determined as soon as the initial order is placed. Customers can choose to exchange or refund goods, and select from a number of customised returns reasons to help retailers better monitor their returns and report costs accurately. ZigZag has access to multiple warehouses worldwide, and will aim to keep return costs low by establishing fixed cost agreements with major international courier partners. Returns are tracked wherever possible, and ZigZag will give visibility on what’s coming back and how much it will cost before it has even left the customer. The local ZigZag receiving warehouse then scans and inspects the goods are as described, and on the same day the retailer can send a replacement or a refund, speeding up the process and improving the customer experience. ZigZag will grade the goods for you and can offer product refurbishment if required. ZigZag can then consolidate all returns to send them back to the retailer itemised by pallet, at the most cost efficient time. But here’s the clever bit…
Instead of sending the goods back to the retailer, ZigZag can re-sell the goods and redistribute them locally, aiming to save retailer’s money on the cost of processing returns and reducing your carbon footprint. ZigZag plans to have access to multi-lingual services and staff , and aims to operate in 8 languages on major international marketplaces. Al Gerrie and laurence Guy have already built another business, We Are Pentagon that trades on international marketplaces for it’s clients, so we feel able to demonstrate that ZigZag is exceptionally well placed to resell your products.
ZigZag Global – Returns re-sold.
The business case:
- Retailers need local returns addresses and faster returns processing to satisfy customer demand, as well as a disposal method for this stock.
- Other solutions sometimes simply consolidate stock and return it to the retailer which doesn’t actually solve the problem.
- We feel that ZigZag Global is unique in that it warehouses returns locally and resells stock via marketplaces which means goods typically don’t have to be sent back to the retailer.
There are four headline mechanisms that ZigZag looks to offer to solve the returns problem. Some examples of these are given below:
Example 1: Returns Resold
- UK Retailer sends goods to customer in Melbourne Australia.
- Customer returns goods to ZigZag Warehouse in Sydney Australia.
- ZigZag resells goods via eBay Australia and gives UK Retailer cash.
Example 2: Fulfilment
- UK Retailer sends goods to customer in Berlin Germany.
- Customer returns goods to ZigZag Warehouse in Frankfurt Germany.
- UK Retailer has another order for a customer in Hamburg Germany
- ZigZag fulfills using the stock it is holding locally in Frankfurt
Example 3: Goods can be destroyed
- US Retailer sends goods to customer in US
- Damaged item can’t be resold
- Goods can be consolidated for return or destroyed if required
- Or US Retailer can elect not to ask for the item back, saving postage
Example4: Intelligent routing:
- UK Retailer sends goods to customer in Paris France.
- Customer returns goods to ZigZag Warehouse in Frankfurt Germany as sales are higher for that item in Germany.
- ZigZag resells goods via Amazon Germany and gives German retailer cash.
All of these instances should result in the customer receiving their refund faster (usually next day) and the retailer saves money on transportation.
ZigZag could also act as a disposal route for domestic stock marketplaces and even courier non deliveries.
ZigZag appeals to major cross border retailers: Marketplaces like Amazon now insist that all Cross Border retailers offer local returns addresses. Retailers also typically do not have local facilities in all major territories so this is a pain point for most international sellers.
ZigZag aims to be unique by leveraging worldwide marketplaces and established relationships with retail clients that have already declared interest in the service. ZigZag will partner non-exclusively with WeArePentagon.com (an established service provider in this sector) to offer this service.
ZigZag aims to partner non exclusively with multiple 3rd parties such as global marketplaces, carrier management software providers, ecommerce platforms such as Hybris, ATG and Magento, international couriers and 3rd party warehouse logistics providers. Through these partnerships, ZigZag has the prospect of a sales and marketing presence worldwide, and global scalability. We feel it is in the interests of both the couriers and the warehouse providers to promote the services of ZigZag to their clients as ZigZag will create revenue, so this will ensure sustainability and growth.
ZigZag has already secured contracts with a leading carrier management software provider and has warehouses available in major ecommerce markets. Warehouses will be rolled out according to demand, but the Company aims to launch in the UK, US, Australia, France, Germany in the first phase. Phase 1 is expected to be available from September 2015. Phase 2 is anticipated to include China, Indonesia, Malaysia, Brazil, India, Japan, New Zealand, Spain and Italy. Phase 2 will begin rolling out in 2016 but can be brought forward if there is demand. The company is also in negotiations with global couriers and local domestic providers and will launch these as required.
Our mission is to improve the customer service and international returns proposition of online retailers, reduce costs, boost their customer retention and increase their sales. We strive to improve the overall image of the online retailer and therefore stimulate growth of online shopping. We aim to increase customer satisfaction when customers deal with retailers, to speed up the returns and customer service process when retailers communicate with customers, and to streamline the returns solution order in all possible ways, whilst creating new revenue in an efficient way that is also environmentally friendly.
The vision behind the company is to provide a best in class technology platform for international returns that is safe, convenient, and easy to use.
Funds will be used to support the key functional areas of the business:
- Development & testing
- Operations & legal, particularly around IP
- Brand PR & marketing
- Operating capital
ZigZag has been self funded to date.
ZigZag Global’s financials are relatively conservative and based on an average selling price of £30.28 which is Pentagon’s actual AOV across all sellers based on real market data.
- Management income: this is the fee charged when a retailer simply uses ZigZag to receive stock, hold and grade it, and then re-fulfil an order in the same country for the retailer.
- Revenue from returns: this is money raised from the resale of the goods by ZigZag on a marketplace, website or other marketing channel
- Implementation fees: ZigZag will charge these fees up front before beginning implementation to cover basic costs of setting up the services. Additional warehouses can also attract incremental fees.
We anticipate the split to be 20% Management income, and 80% Revenue from returns. Implementations will be provided as a chargeable service.
Use of funds:
To support operating costs and product development before the business is cash self-sustaining.
Expenses and profitability:
Revenue is derived from management income, returns processed and implementation fees. Expenses: Product sales & marketing is conducted and expensed by the distribution company and therefore these costs are low as a percentage of sales to ZigZag. Key areas of expenditure are management, PR and development. External costs include warehousing and fulfilment, carrier management software and carriage, plus resale of goods. Internal costs are largely fixed with inflationary increases only and outsourced costs are linked to successful sales so are sustainable.
ZigZag has already had initial discussions with global retailers and major UK brands. ZigZag has already begun software development is integrating to Pentagon clients at present. ZigZag will offer early adopters discounts to incentivise them to trial a beta program. ZigZag intends to launch in summer 2015.