Why reCommerce Is the Missing Link in Your Ops Stack

The Overlooked Weak Link in Supply Chains

Modern supply chains have undergone a digital revolution, except at the very end. Companies boast automated factories and AI-driven logistics, yet many still handle returns and excess inventory with decades-old methods. It's a jarring disconnect: the average supply chain is only 43% digitized, making it the least digitized business area according to McKinsey. In fact, a mere 2% of supply chain executives even focus on digital transformation in this arena. This means the “last link" - dealing with unsold; dealing with unsold, returned, or excess products – is often the weakest. A supply chain is only as strong as its weakest link, and for many organizations that link snaps right at the end.

Legacy reCommerce Processes Slow You Down

If your reverse logistics and reCommerce processes still rely on ad-hoc liquidation deals, manual spreadsheets, or siloed teams, you're not alone – but you are falling behind. Legacy approaches to returns and liquidation create hidden drags on modern operations. Piles of returned merchandise sitting in warehouses tie up capital and space, undermining the efficiency gains of your high-tech distribution centers. Meanwhile, slow, manual disposition means missed opportunities: Retailers already liquidate over 95% of their overstock and returned items on secondary markets, yet often at dismal recovery values. Many firms recoup only 15-50% of an item's original value when they dump it via traditional liquidators or bulk sales. In other words, half or more of the product’s value vanishes due to outdated resale methods. This isn’t just a minor operational nuisance – it’s a direct hit to the bottom line and a brake on your otherwise modern supply chain.

Consider the Scale: U.S. consumers are projected to return $890 billion in merchandise in 2024 – about 17% of total retail sales. Every one of those products must go somewhere. If your solution is a fire sale for pennies on the dollar, you’re leaving heaps of money on the table. Paradoxically, companies obsess over cutting forward logistics costs by a few percentage points but ignore that a modest improvement in resale value can yield far greater gains. For example, reducing return handling costs by 10% might save only a few cents per item, but increasing the recovery rate by 10% can boost profit by $0.30 to $1 per unit. For a retailer processing millions of returns, that translates to millions of dollars in reclaimed revenue. The message is clear: outdated reCommerce processes aren’t just inconvenient – they’re actively undermining your modernization efforts and profitability.

The 3 Tiers of reCommerce Maturity

To integrate reCommerce into your operations stack, it helps to envision a maturity model. Where do you stand today, and what does “modern” look like? Here’s a three-tier maturity model for resale and liquidation:

Tier 1 – Reactive Liquidation (Basic): At this level, reCommerce is an afterthought. Excess and returned stock piles up until it’s offloaded in bulk to whoever will take it. Companies in Tier 1 rely on legacy liquidators or one-off jobbers. Recovery rates are low (often ~15% of retail value) and the process is slow and manual. The focus is on removing inventory to free up space, rather than maximizing value. There is little to no technology integration – it’s the 1990s playbook happening in 2025.
Tier 2 – Structured Resale (Emerging): Firms at this stage treat reCommerce as a distinct workflow that can be optimized. They use online B2B marketplaces and auctions to sell surplus stock more efficiently, tapping into a broader buyer base. Recovery rates improve (e.g. closer to 30–40% of original value) because products are channeled to specialized buyers willing to pay more. Processes become more standardized – you might have a returns management system or a dedicated team for secondary market sales – but it may still be somewhat siloed. The key change is a shift from pure disposal to value recovery. Many retailers in this tier partner with established B2B auction platforms (like B-Stock or Liquidity Services) to get better visibility and speed in liquidation. It’s a step up, but there’s still room to integrate these efforts with the rest of the ops stack.
Tier 3 – Integrated reCommerce (Advanced): At the highest maturity, reCommerce is embedded in your operational strategy and tech stack. The line between “forward” and “reverse” supply chain blurs. Intelligent platforms and data analytics drive decisions on how to route each item: quickly relist high-value returns for direct resale, refurbish or repair where profitable, auction bulk lots to business buyers, or even donate/recycle where appropriate. Nothing languishes in a corner of the warehouse because the system flags at-risk inventory early. For example, new AI-powered solutions like Commerce Central aim to “flag at-risk inventory early and route each item to the optimal channel: resale, liquidation, donation, or recycling”. In Tier 3, the reCommerce process is highly automated and connected – your inventory systems, e-commerce platforms, and warehouse operations all speak to the resale channel. Companies here recover the highest value (often 50% or more of original value on resale) and do it quickly. Moreover, this approach protects brand value (no more dumping product in ways that hurt pricing integrity) and supports sustainability goals. In short, reCommerce becomes a competitive advantage rather than a necessary evil.

Modernizing the Last Link in Your Ops Stack

Adopting a Tier 3 approach might sound ambitious, but it’s increasingly within reach – and the payoff is tangible. Digital transformation doesn’t stop at the customer’s purchase; it extends through the product’s entire lifecycle. Leaders in supply chain digitization are already reaping rewards, from lower costs to higher margins. By bringing returns and resale into the fold, you join this elite group and align with broader modernization goals of agility, efficiency, and sustainability.

Here are concrete steps to start strengthening your reCommerce capabilities:

Audit Your Current Process: Map out what happens to products when they don’t sell or come back as returns. How long do they sit? How are prices decided for liquidation? Identifying bottlenecks and black holes is the first step to improvement. You might discover, for instance, that aging inventory sits 90 days before anyone takes action – a huge value drain.
Leverage Modern Liquidation Channels: Don’t limit yourself to a couple of local liquidators. Embrace digital B2B platforms that create a competitive buyer market for your goods. For example, retailers can use trusted auction marketplaces to reach thousands of business buyers, rather than negotiating with one middleman. Platforms like Commerce Central, B-Stock, and others provide verified buyers and transparent manifests so you can sell excess stock faster and at better prices. This widens your secondary market and often boosts recovery rates immediately.
Integrate and Automate: Treat reCommerce as an integral part of your operations tech stack. This could mean integrating a returns management solution or marketplace platform with your warehouse management or ERP systems. The goal is real-time visibility – if a product is returned or marked as excess, your team (or algorithms) should instantly know and decide the next step. Automation rules can help, such as automatically listing certain categories of excess inventory on an auction site after X days, or triggering refurbishment workflows for high-value items. The more you can bake reCommerce into the operational flow, the less it will rely on last-minute, manual decisions.

Embrace a Mindset Shift: Finally, success in modern reCommerce is as much about culture as technology. Leadership should champion the idea that reCommerce is a strategic extension of the supply chain, not a scrappy backroom activity. Set KPIs for value recovery, velocity of resale, and even customer experience of returns. Celebrate wins – every dollar recovered from liquidation or every week cut from the returns cycle is a boost to your bottom line and your sustainability metrics. When teams see that resale and liquidation performance is being measured and improved, they’ll