Chain Reaction is Sourcing Journal’s discussion series with industry executives to get their take on today’s logistics challenges and learn about ways their company is working to keep the flow of goods moving. Here, Disney Petit, CEO of LiquiDonate, discusses how the returns and warehouse management solution is helping retailers turn excess inventory and unsellable goods into opportunities for community impact and operational efficiency.
Petit discusses how LiquiDonate is helping retailers turn excess inventory and unsellable goods into opportunities for community impact and operational efficiency.
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Name: Disney Petit
Title: CEO
Company: LiquiDonate
What is LiquiDonate?
LiquiDonate sustainably reroutes excess inventory, returns and unsellable goods from retailers to nonprofits instead of landfills, transforming a costly problem into a tax-deductible, socially impactful solution. Our software integrates with any retail management system (RMS) or warehouse management system (WMS) to make donating more seamless than ever before, unlocking environmental, social and governance (ESG) wins, operational savings and brand loyalty in one platform.
What industries do you primarily serve? Which industry do you think has the most to teach fashion about improving their supply chain logistics?
LiquiDonate primarily serves retail and e-commerce brands that process returns and have ongoing excess inventory in the form of warehouse bulk that cannot be resold and often ends up in the landfill. The top lesson to teach fashion about improving their supply chain logistics is very simple: It is possible to have a sustainable supply chain that does not cost you more money.
Historically, there hasn’t been a cost-effective way to make donation work over dumping, and while companies want to do the right thing, the financial constraints prevent them from doing so. We solved this problem with LiquiDonate by signing up a vetted network of over 4,000 nonprofits all over the country. What this does is immediately reduce any transit for a returned or warehouse item to 30 miles or less, versus hundreds of miles. That is a direct decrease in supply chain costs. Our ReturnsDirect solution routes items directly from the customer to nonprofit, skipping the warehouse and eliminating the costs associated with that end of the supply chain.
What is the main thing brands and retailers could do (or stop doing) right now that would immediately improve logistics?
They could discontinue returning unsellable items to the warehouse just for it to sit there and ultimately go to the landfill. And this doesn’t necessarily mean offering “keep it” returns [aka returnless refunds], either, as that leads to increased fraud. There are sustainable alternatives that have emerged, including upcycling, downcycling, peer-to-peer discounted returns and, of course, donation, which is our main disposition.
When it comes to supply chain logistics challenges, there are things companies can fix, and things that are beyond their control. How can the former help the latter?
There’s a good example here, which is returns fraud. You cannot control human behavior, which is unfortunately not always honest. A recent Narvar report said that 52 percent of consumers admit to committing some level of retail returns fraud or abuse in their lifetime. That’s pretty shocking! What you can control is your return policy. If you eliminate ”keep it” returns, that will eliminate a lot of the associated fraud, because consumers will no longer be able to rely on both getting their money back and keeping the item.
What area of logistics isn’t receiving the industry attention it deserves?
Circularity still doesn’t receive enough attention. Every year, $800 billion worth of unsold, perfectly usable inventory goes to the landfill. At the same time, millions of people are unhoused and under-resourced all over the world. It’s a waste of money, the environment and humanity.
When it comes to creating efficiencies, there are quick wins and longer plays. What are a few things your company is doing to help its partners succeed on both fronts?
For quick wins, we offer WarehouseDirect, which is an easy online solution to move any warehouse excess to a local nonprofit. It only takes a few minutes to enter items by the box, pallet or truckload—or upload a manifest directly for larger loads. Our Magic Match algorithm has it routed to a local nonprofit typically within seven days.
As a long-term solution, we also offer ReturnsDirect, an easy software integration which routes any unsellable merchandise directly from the customer’s point of return to either donate, up/downcycle or recycle. By skipping the warehouse, retailers exponentially lower their reverse logistics cost and benefit their local communities at the same time.
What is your company doing to make the movement of goods more sustainable?
That phrase is why we exist—it’s everything we do!
What logistic challenges (if any) do you think the industry is currently facing?
There are so many, between increased fraud, tariffs, uncertainty and just increased competition in a noisy online environment.
What is the one thing brands and retailers could be doing to make better use of technology to improve logistics?
They can definitely review all of the possible integrations within their WMS, RMS and even Shopify. There are so many software companies like ours that leverage technology to make it easy for all of these merchants and not have to switch softwares.
Are you optimistic about the state of supply chains in the next few years?
I’m very optimistic. Younger generations are really speaking up and demanding transparency in the supply chain as they choose retailers.
