It’s that time of year that retailers surely dread: Returns season. Not only does it follow fast on the Thanksgiving-to-Christmas gift-buying rush, with nary time to take a breath, but it also erases some of the gains in revenue attributed to the holidays.
The National Retail Federation projects that 15% of 2023 holiday sales will be returned, or about $148 billion in merchandise. The industry group put overall holiday sales at $966 billion.
I attempted to be part of the returns crowd for a sweater gifted by an in-law, a crewneck in a style called “shrunken,” which meant it ended near the navel — something my daughter might wear but not me.
So I toted it off to a local mall, receipt in hand. There I was told the store couldn’t help me because it was an outlet version of a national fashion brand, while my gift came from the full-price namesake — and the two don’t mix inventory.
Say what? My options were explained as finding the closest full-price store (the clerk tried to be helpful and scrolled his smartphone to show me an address in Manhattan) or go the online route.
With no trip to the Big Apple in sight, I logged on to the “Help” section of the retailer’s website and began a week of maddening email exchanges with at least four people, each encouraging me to initiate an online return, which involved securing a QR code to flash at the Post Office to receive a prepaid label to slap on the sweater I’d packaged for mailing — with a resulting $7.50 fee deducted from the store credit I would receive.
The company reps all reiterated the no-crossover policy on returns/exchanges, which one wrote was due to the merchandise being “completely different” at full-price versus outlet stores. None took my bait that the policy was not customer friendly.
I found some solace, though, in an annual survey of shoppers and merchants by Happy Returns, a so-called reverse logistics firm that helps retailers manage online returns.
The firm, acquired last fall by shipping giant UPS, said surveyed shoppers disliked having to mail returns, with 90% saying they avoided retailers that require it. Instead, shoppers preferred paying third parties to handle everything.
(For the record, Happy Returns operates such “Return Bars” nationwide, but the survey, of 2,000 shoppers and 200 retailers conducted by an independent researcher, nevertheless offered insights into returns.)
Surveyed apparel and footwear merchants said they’ve seen returns jump since the pandemic, when online shopping skyrocketed, and as a result, 81% started charging in 2023 for at least one method used to accept returns.
Shoppers, though, want to avoid fees, so the report suggested retailers might look for a middle ground, such as keeping exchanges free but charging for returns.
“Return policies are so important they can impact revenue before a purchase is even made,” the report says. “If returns aren’t easy and convenient, first-time shoppers won’t shop, while returning customers may stray.”