by Mark Palumbo
Director of Business Development, PanurgyOEM
In my years in this business, I’ve seen every approach imaginable. Some work. Most don’t. The difference usually comes down to one thing: velocity.
Here’s a truth that too many operations leaders learn the hard way.
Every electronics return demands a decision: repair, refurbish, scrap, or do nothing.
And the quality of the action that follows determines whether value is recovered or lost.
That sounds obvious. In practice, it’s where most value quietly disappears.
Returns aren’t hard because of volume
If volume were the problem, apparel would be the hardest category in the world.
Clothing dominates return volume. Sizing, color, preference, buyer’s remorse. Huge numbers come back every day. But those returns are easy to process.
Most boil down to two paths: restock or scrap.
A returned mixing board, laptop, or fitness console is an entirely different animal. Is it actually defective? If so, what is wrong with it? Can it be repaired economically? Is it worth refurbishing for resale? Are there data security concerns? Does it need firmware updates? Are parts available?
Volume creates work. Complexity creates risk. And risk is where money disappears.
Why Electronics Returns Require Real Decisions
Here is something that sounds obvious but has profound implications: every electronics return requires judgment. Not just routing. Not just categorization. Actual judgment.
According to Accenture and TechSee, 68% of all consumer electronics returns are classified as “No Fault Found.” That means more than two-thirds of returned electronics are not actually broken. They were returned because the customer could not figure out how to use them, changed their mind, or simply decided they did not want them anymore.
This creates a cascade of decisions that do not exist in other product categories. Is this unit functional or not? If functional, can it go back into primary inventory or does it need to be sold as B-stock? If not functional, is it economically repairable? If repairable, should it be returned to the original customer or refurbished for resale?
Routing is easy. Deciding is not.
The Four Real Decisions
Strip away all the complexity, and every electronics return ultimately faces one of four decisions:
- Repair — Fix the unit and return it to the customer. This is the path when there is a genuine defect, and the customer wants their specific unit back. It requires diagnostic capability, parts availability, and technical expertise.
- Refurbish — Restore the unit to sellable condition and recover value through resale. This applies to functional units that cannot return to inventory as A-stock, repaired units that the customer no longer wants, and units that need cosmetic restoration.
- Scrap — Discard securely and compliantly. Some units are beyond economic repair. Others contain data that must be destroyed. The key is doing this properly—with documentation, data security protocols, and environmental compliance.
- Do Nothing — The unit sits. On a pallet. In a corner of the warehouse. Waiting for attention.
What I’ve learned in nearly 10 years in this business: doing nothing is always a decision. It just doesn’t feel like one.
Time, not labor, destroys margins
A laptop that could have been refurbished and sold for 60% of retail six months ago might be worth 30% today. A pro audio component that was state-of-the-art when it was returned may be a generation behind by the time it gets processed.
Every day a return sits unprocessed is a day its value declines.
Markets move. Models age. Resale windows close. What could have been repaired or refurbished last quarter quietly becomes scrap this quarter.
Not because it was unfixable.
Because it sat still.
Where value is actually earned
Value is not earned by having the perfect repair process on paper.
It’s earned through velocity.
Speed to assess. How quickly can you determine what you are dealing with? A unit that sits in receiving for two weeks before anyone looks at it is already losing value. Immediate intake, systematic diagnosis, and clear categorization are where the clock starts.
Speed to decide. Once you know what you have, how quickly can you route it? This requires having the infrastructure, expertise, and processes in place before the return arrives. Decisions should not wait for meetings, approvals, or resource allocation.
Speed back to customer or market. Whether a repair is going back to the original customer or a refurbished unit is being listed in your B-stock store, the final mile matters. A four-day repair turnaround beats a two-week turnaround every time—for customer satisfaction, for brand reputation, and for your bottom line.
The faster a return moves through that sequence, the more value survives.
Slow returns do not fail dramatically. They fail quietly. They bleed value day by day until there’s nothing left worth saving.
Closing takeaway
Every return gets a decision.
- Repair
- Refurbish
- Scrap
- Delay making a decision and do nothing
There are no neutral decisions.
Decisions one, two, and three recover whatever value that return can realistically deliver.
Decision four is the fastest way to turn otherwise sellable products into junk.
That’s the reality of returns.
