An increase in gift return is closely monitored during holiday shopping seasons.
It may prove difficult to get things back this year for free, or even at a very low price.
According to recent surveys of retail executives, 60% said that they are making changes to their existing return policies. However, fewer retailers promise free returns.
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The National Retail Federation has released its most recent statistics. It shows that retailers anticipate returning 18% of the merchandise they sell during holiday shopping season, which is $158 billion.
The return rate for 2021 was 16.6% of U.S. total retail sales or $761 billion. In 2022, fewer companies will be in a position afford to pay such high prices.
Many retailers are changing their return policies due to rising prices and shrinking margins. Some have reduced the window for returns and started charging fees. Spencer Kieboom is founder and CEO at Spencer Kieboom. Pollen Returns, a return-management company.
Expect shorter return windows, restocking fees
Amazon.com package carriers hold a letter carrier while they prepare a vehicle to be delivered at a United States Postal Service distribution and processing center in Washington D.C.
Andrew Harrer | Bloomberg | Getty Images
Gap, Old Navy and Banana Republic are just a few of the stores that carry J. Crew, once a well-known store for its generous returns policy which lasted the life of garments, has shortened its regular return window to one month. J. offers some relief for year-end shoppers. Crew, among others, offer extended holidays returns and exchanges.
Anthropologie has L.L. Bean and REI. Bean (which also once promised lifetime returns), there’s now a fee — all around $6 — for mailed returns.
Kieboom explained that “these adjustments in return policy are not there for costs.” They are there to discourage the customer from returning.”
Margin shrinking due to rising costs
Blue Yonder senior director Erin Halka stated that “free returns” was an attractive option because of the explosion in online shopping. She said that retailers are now paying more for shipping and labor, which makes it difficult to maintain.
She said that charging for returns was one way of covering a part of the cost. Customers may be discouraged from buying too many goods, as at least 10 percent of the returned items cannot be resold.
Kieboom explained that retailers often struggle to manage excess inventory.
Supply chains are designed so that they only go in one direction.
Lauren Beitelspacher
Babson College Associate Professor
Lauren Beitelspacher (associate professor, chair of Babson College’s marketing department) stated that “the supply chain was designed to move one direction.”
Beitelspacher explained that retailers will lose more on returns if they don’t raise prices.
“Changing the return policy for customers is easier than increasing the price of the product.”
What to do to avoid returning fees
Despite this, online shoppers still love free returns as much as free shipping. According to PowerReviews, 98% consumers declared that shipping is the main consideration in online shopping. More than three quarters agreed with the statement about free returns. The preference for a return policy was even greater among the wealthy.
Experts recommend that you get to learn the policies prior to buying. Halka stated that it is often not obvious. It is common to have to look into fine print.”
There are restrictions on the amount and time that can be sent back, she stated. A 30-day turnaround is common.”
This is a good time investment to make the most of your purchase. Kieboom stated, “You need to choose the best return policy for you.”
Beitelspacher suggests that shopping in-person is a good option for those who want to eliminate returns. The majority of returns are due to regretting that something wasn’t what we had expected. She said that shopping in person reduces the expectation-reality gap.
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