3 Things You Can Do to Reduce the Costs of NTF

We’ve all heard the familiar saying “if it ain’t broke, don’t fix it,” but what happens when your customer thinks a product is “broke” when it isn’t? You have a “No Trouble Found” (NTF) situation. NTF returns incur both direct and indirect costs. While you can easily calculate costs associated with testing and transportation, it’s harder to gauge the impact that high numbers of returns can have on your company’s brand and customer relationships. Even if there’s nothing wrong with the product, your customer thinks there is a problem.

In many industries, NTFs make up a substantial proportion of returns. For example, almost 75% of mobile phones returned by users in Europe and North America in 2015 fell into the category of NTF. If the product is working properly, there’s no reason to ship it across the globe to a repair center and keep it out of service for weeks, or even months. Here are 3 ways you can avoid that downtime and expense.

1. Develop More Efficient On-Site Processes & Information Gathering

On-site troubleshooting is your first line of defense against NTF returns. Your field technicians want to get the client’s systems up and working as quickly as possible. They aren’t going to spend a lot of time trying to determine why the device failed; your customer simply wants a working replacement.

However, if you develop a process to walk your techs through a few extra tests or troubleshooting exercises, it may be possible to get the unit back into service immediately. That’s a lot better than waiting for the unit to be returned, paying for transportation, and testing it — only to discover it was working fine all along.

Your action items:

• Review on-site procedures: Is there any room for improvement or capacity to add 1-3 additional tests or troubleshooting questions? Try to create procedures that enable techs to easily gather and share information that will help easily identify trends and reduce the number of NTF returns.
• Monitor processes: Are the processes already in place being followed? Implement a system to monitor and track how well the current system is working. If it’s not, you can probably fix the hiccup right then and there. If it is working as designed, then you can take a look at how it can be improved.
• Educate: Train service techs and end-customers on features and functionality. Examine your data to find specific issues that often cause confusion or unnecessary returns.

2. Pay Attention to the Details and Know the “Why” Behind Trending Data

There are no minor details in testing spare parts for failure. Every piece of data is important to the engineers who design for performance as well as serviceability. You never know what piece of information will be the key to solving a problem.

Your action items:

• Track: Implement tracking systems that monitor every available data point – date/place of manufacture, stocking locations, inspector names, etc.
• Communicate: Encourage communication between your repair department/partner and your engineering team. Together, they form a critical knowledge base that can improve product quality and serviceability design for your next-generation products.

For example, Flash Global has a customer who was experiencing a high number of failures on a part, but there was no apparent design or quality flaw. Everyone was surprised by the real cause: packaging! The part was well-designed, but the packaging wasn’t. Our customer changed the packaging and went from 12% OBF to less than 2%.

3. Screen Parts In-Region, Close to Your installed Base

Tighten your reverse supply chain with in-country or in-region test/repair centers. This helps reduce transportation costs, inventory carrying costs, and turnaround time. Anything you can do to lower these costs helps control TCO and increase profits.

Here are two real-world examples where in-region screening could save time and money:

1. A manufacturer collects six pallets word of “defective” product before shipping the entire lot by boat to Asia for repair, a 4- to-6-week trip each way. On average, 40% of the parts were found to be NTF, meaning they were unusable for three months due to being in transit, even though they were working fine. Adding a routine screen before shipping gets those units back into service in less than a week. No ocean voyages or air shipments required.

2. A manufacturer stockpiles defective units before shipping to a repair depot. The average turnaround time is 16 weeks, so the company often has to replace returned units with new product instead of replenishing with repaired or refurbished stock. New units cost $10,000 each, so every NTF unit removed from service for four months increases costs.

In both examples, the company’s attempt to reduce costs with a single ocean shipment to a repair depot actually does the opposite by keeping NTF products out of service for months, potentially causing shortages that require air shipments of new products to support their customers.

However, a small to midsize company can’t possibly maintain dozens of test-and-screen facilities all around the world. The financial expense, trade compliance complexities, and language barriers are just too much, right? Wrong! You don’t have to build and staff warehouses and repair depots in every country where you have customers.

That’s because Flash Global is already there.

With operations in over 140 countries, we can support your service supply chain with in-region test-and-screen facilities, forward stocking locations and repair depots. We handle the trade compliance paperwork and stringently follow all import/export laws and regulations to help ensure the efficient movement of spare parts across international borders. Contact a Flash Global expert today to learn more about ways to reduce costs associated with NTF.