The rapid expansion of e-commerce has introduced significant challenges in logistics, particularly regarding inventory inaccuracies, inefficient order picking, and product damage during delivery. These issues contribute substantially to high return rates, operational disruptions, and customer dissatisfaction. This review explores the intersection of technological and process innovations aimed at minimizing returns and damage through enhanced inventory accuracy and packaging strategies. By synthesizing current research, this identifies key advancements in inventory management, such as the deployment of RFID, IoT-based sensors, and real-time data analytics, which enhance visibility and stock precision across distributed warehouses. The role of pick optimization, leveraging robotics, artificial intelligence, and automated warehouse management systems, is also examined for its potential to reduce human error and accelerate fulfillment processes. In parallel, this highlights cutting-edge packaging innovations including custom-fit packaging, impact-resistant materials, and smart packaging equipped with shock and temperature sensors. These technologies not only prevent product damage but also contribute to sustainability through material optimization and waste reduction. The integration of these systems forms a synergistic framework that reinforces operational resilience, ensuring continuity and responsiveness even under variable demand conditions. Through industry case studies and performance metrics, this demonstrates measurable reductions in return rates and improved customer satisfaction linked to these innovations. Despite clear benefits, challenges such as technology adoption barriers, cost implications, and data security concerns remain prominent. This review concludes by emphasizing the need for scalable, adaptable solutions and calls for further empirical research on long-term impacts and best practices. Collectively, this provides a comprehensive overview of how inventory and packaging advancements can significantly transform e-commerce logistics and pave the way for more reliable, efficient, and customer-centric fulfillment operations.