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You are a PM at a hyperlocal grocery delivery startup. You see high returns for orders on rice. What could be the root cause? What are your hypothesis? How would you go about solving this?

Details:

  1. Issue has been seen since the inception of the idea.
  2. Startup serves in just one city so geography affected is that entire city.
  3. Users orders rice and then returns it back.
  4. Only Rice segment is impacted.
Looking for:
  1. Root cause
  2. Hypthesis
  3. Solution approach
  • Related to Problem Solving
  • For Enterprise PM
  Amazon
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Answers (4)

Rice is a food item which is embedded in every individual’s regular meal, hence customers always prefer to keep the taste and quality consistent.

I will categorize the overall return hypothesis in major 2 categories

1. If Rice was used min once and then returned

a. Taste does not match with customer’s expectation –

b. Product quality (Grain size, broken grain etc) is not upto the mark

c. Rice is not clean (bugs found in the rice)

2. If Rice was returned even before trying it

a. Product quality (Grain size, broken grain etc) is not upto the mark

b. Rice is not clean (bugs found in the rice), stinks, wet

   c. Cheaper option for the same quality found with competitors
Let us get to the root-cause of each hypothesis
1.a, 1b and 2a.. –> Indicate that the Product is not delivering the same quality, value as promised
1.b and 2a. –> Additionally indicate – Packaging or delivery may have some flaws
1c and 2b.. –> Indicate multiple things
   1. Product quality has a problem
   2. Sourcing or Storage facility is not clean

2c. –> Self explanatory – Competition with cheap price is winning the customers with better offers

I will like to learn to conduct primary research with customer’s who have returned the Rice to understand the prominent reasons behind the Return and then fix the problem with below solution approach

1. Change the Sourcing agent or impose stricter rule on the same agent to procure better quality product

2. Improve the storage facility hygeine if self owned or impose stricter hygiene rules on the 3rd party storage

3. Run better offers to match competitors

4. Product friendly packaging

I’d approach this problem statement with the following hypothesis. Order returns must be happening because of the following main reasons:

1. Difference between the information shown and actual product

2. Packaging and handling issues particularly with rice

3. Quality needs were not satisfied

Elaborating on the first main reason i.e. “Difference between the information shown and actual product”. It can be because of the following root-cause:

  • the brand mentioned on the rice bad packet is not reflecting properly in actual
  • customers have weight issues. Either the weight mentioned doesn’t match the actual delivered product or the weight is not mentioned on the rice category putting less/incomplete information
  • There are many grades of rice. Maybe the less/no info regarding rice grades trigger the returns
  • The product is as shown but does not have any food license
  • Less/No information about it’s type (white or brown; organic or otherwise)
Solution Approach: Make sure details shown on web/app is same as what is delivered. If there’s no or incomplete info regarding grade, type, brand, weight (with SI units), Food license details and accurate photographs of both rice grains and it’s packaging, make these details incorporated

Elaborating on the second main reason, the following could be the main root-cause:

  • Rice image was shown in the catalogue, but there was no description of packaging. The customer could have got loose packaging
  • The color of packaging might be different from what is shown in the image
  • There was a packaging fault in all the packets/bags
  • Packaging received was shown as-is but it’s delivery handling doesn’t compliment the packaging
Solution Approach: Make sure to inform the customers about the packaging and handling details both pre-ordering and post-ordering, about the type of rice packet bag(plastic, jute, paper) and whether it contains handle or not. Also, make sure there’s no leakage while doing the delivery and if there’s a leakage, make sure to proof seal the product in the warehouse.
Elaborating on the 3rd main reason, if most of the customers will have quality issues they will return the used product. In this case, procurement channels of the rice must be revisited and make sure a better quality product is served to customers to minimize the returns.

A thorough approach to this Flipkart problem solving question as follows:

CQs

  1. Hyperlocal grocery delivery startup – can I assume this is something like BigBasket, which also sells rice as a part of its catalog – Yes
  2. When we say returns – is this when users are ordering, receiving the item and then looking it and sending it back? – Yes
  3. When we say rice – is there a specific brand of rice that is affected? – We don’t know that.
  4. Has this happened recently or has this been happening over a long period of time? – Returns have been gradually increasing during the last month

Goal: Figure out why BigBasket users are returning rice after receiving it

Structure

  1. Discussion of an ordering journey
  2. Possible problems that could have arisen at various stages
  3. Solutions to fix the identified problems

Grocery Delivery Order Journey

  1. User places an order
  2. User waits for the order
  3. User receives the order
  4. User is happy with it or user returns the order

For diagnosing the issues, there are two types of challenges we could be facing:

  1. External Factors
    1. Anti-Rice propaganda – There could be news doing rounds about rice that could be leading them returning the rice they are ordering
    2. Pro-alternative trend – Is there a fad new diet going on around which is making users choose alternatives
    3. Rice Farmer Protest – There are farmer protests going on in the market for fair practices. Is BigBasket sourcing from any of these vendors who are not following ethical practices.
    4. Regulatory Reasons – Has the government enacted any regulation that makes purchasing rice from alternative sources extremely cheaper or has rice rates been declining continuously due to a similar regulation
    5. Bad PR about Rice on BigBasket – Has there been any news about how rice on BB is genetically modified or is unsafe for consumption. Have these stories been increasing every day.
  2. Internal Factors
    1. Product-Related
      1. Ordering Related
        1. Mislabeled products (rice is labeled as others)
        2. Expired Products
        3. Wrong labeling of various variants of rice
        4. Misordering of quantity (confusing feature)
      2. During the Wait Time (Supply Chain)
        1. Getting the wrong order size
        2. Late delivery of rice due to supply chain issues
      3. Post Delivery
        1. Bad Packaging
        2. Wrong labeling
        3. Bad product (worms, discoloration etc)
        4. Bad product (looks fine but tastes bad)
    2. Engineering Related
      1. Issues in the order management system
      2. Misfiring APIs adding the wrong item to the cart
      3. Wrong billing of rice related items

    Solutions

    Depending on the issue identified, I will try to find solutions to fix the problem. Assuming the packaging is the problem. Some solutions for this could be:

    Step 1

    1. Auditing the rice packing system to ensure that packaging has the highest standards possible.
    2. Consider removing the vendors who are providing sub-standard packaging of products to the users

    Step 2

    1. Updating the information on the website with the new packaging and information
    2. Encourage users to re-order rice in its brand new packaging

 

The approach I will take for this Flipkart problem solving question is to list down the hypotheses for why customers are returning rice and simultaneously spell out how I would validate the hypotheses.

Usually when a customer returns an order, it could be for these large buckets of reasons

  1. The product dint come on time.
  2. The delivered product does not match the “specs” that the customer had in mind while placing the order.
  3. The delivered product matches the “specs” that the customer was thinking of, but doesn’t satisfy the needs for which the customer is “hiring” the product.
Expanding the first hypothesis: The product dint come on time.
The timeliness of the order can be key for the customer, especially if the product being ordered is perishable or the need for the product is immediate. This is very characteristic of the food delivery space where food arriving late could be cold or not tasty and therefore will be returned, or the food has arrived so late that the customer couldn’t control their hunger and had to resort to an alternative.
This rule could apply to groceries delivery and by extension to rice as well. It’s unlikely that the rice delivery took so long that rice perished on the way, so the only possible hypothesis here is that the customer placed an order for an immediate requirement of rice and the order came too late by when the customer had found an alternative. To verify this hypothesis, I would check the metric (actual delivery time)/(expected delivery time) for grocery orders that contain rice and don’t contain rice. If there is no large difference between the two, I would reject this hypothesis.
Expanding the second hypothesis: The delivered product does not match the “specs” that the customer had in mind while placing the order.
The typical specs that are associated with rice could be
  • Quantity: Weight, number of packets, etc
  • Brand: Private brand, White label, Loose
  • Type 1: White, Brown, Bullet, Basmati, etc
  • Type 2: Long grain, short grain
  • Type 3: Polished, unpolished
  • Could be more types
If the delivered order does not match any of the above parameters that the customer had in mind, then that would lead to a return. To validate this hypothesis, I would check if my UI clearly spells out these parameters or if any of them are obfuscated. Since there are different ways of defining the type of the rice, I would check if those are being spelt out clearly.
Expanding the third hypothesis: The delivered product matches the “specs” that the customer was thinking of, but doesn’t satisfy the needs for which the customer is “hiring” the product.
The assumption here is that the customer can return the rice even after having used it partially. If no, then this whole hypothesis can be discarded. If yes, and if the customer is returning opened packets of rice, then there’s a good chance the reason lies in this bucket. The main reason here would be bad quality. If the customer doesn’t like the quality of the rice after cooking they would return it. Probably the rice has stones it. The other reason here could be that the customer is not “hiring” the right kind of rice for their “needs”. For example, if the customer wants to make good biryani they should be ordering Basmati or long grain rice.
I would also force the user to send in feedback in the product when they’re applying for a return. This subjective feedback along with the ways to accept/reject the hypotheses mentioned above should help me triangulate the right reason for the returns.