Use automated return triage in Jaipur?
Before the decision
The fulfilment team spends equal time screening low-value and high-value returns. Many returns are low-value and easy to classify. The process becomes contentious when the photographs are unclear and the buyer and seller disagree about condition.
The problem
Should the team choose Automated screening or Manual sampling for the next 12 months?
Decision owner: The business unit lead.
Automation might reject legitimate claims when product photos are poor.
Option economics
Scroll the table to see all figures.
| Option | Volume (returns) | ₹ per unit | Fixed cost | Net contribution |
|---|---|---|---|---|
| Automated screening | 2,80,000 | 26 | ₹62 lakh | ₹10.8 lakh |
| Manual sampling | 2,60,000 | 22 | ₹46 lakh | ₹11.2 lakh |
Make the call
- Calculate net contribution for Automated screening and Manual sampling. Which assumption makes the comparison most fragile?
- If the leading option delivers 10% fewer returns, does your recommendation change?
- What evidence would you ask for before the team makes an irreversible commitment?
Reveal the worked solution
Start by validating Manual sampling. It contributes ₹11.2 lakh after fixed costs and leads by ₹0.4 lakh. Treat that gap as the amount of unmodelled cost or lost contribution the option can absorb before the ranking reverses.
- Frame the decision
Compare the cost of delivering a successful outcome, including exceptions and manual work. Check whether the operating team can run the new process.
- Calculate both options
Automated screening: 2,80,000 returns × ₹26 less ₹62 lakh in fixed costs gives ₹10.8 lakh. Manual sampling: 2,60,000 returns × ₹22 less ₹46 lakh in fixed costs gives ₹11.2 lakh.
- Stress-test the forecast
Manual sampling leads by ₹0.4 lakh in the base case. If Manual sampling delivers 10% fewer returns (2,34,000) at the same margin and fixed cost, it contributes ₹5.48 lakh. Holding the other option constant, the stressed result falls behind. This isolates volume risk. Check whether both options would respond to the same change in demand.
- Set a decision threshold
Holding the other option’s result fixed, Manual sampling needs at least 2,58,182 returns to match or beat it under the model. Use a blinded quality audit and report false rejects alongside turnaround.
Automation might reject legitimate claims when product photos are poor. Compare the cost of a limited test with the loss the business would face if the full commitment failed. Ask the team to agree the decision criterion before collecting more evidence.
What if the whole market moves?
The worked solution tests a change to one option at a time. Here, both options gain or lose the same percentage of volume. Unit contribution and fixed costs stay constant.
| Volume scenario | Automated screening | Manual sampling | Higher contribution |
|---|---|---|---|
| Both lose 10% of volume | ₹3.52 lakh | ₹5.48 lakh | Manual sampling |
| Base assumptions | ₹10.8 lakh | ₹11.2 lakh | Manual sampling |
| Both gain 10% of volume | ₹18.08 lakh | ₹16.92 lakh | Automated screening |
Explain which option you would take forward. Check whether capacity, price or customer mix would also change as the market moves.
Practise this case as an interview