Returns continue to remain a pressing issue for the US retail industry, with total returns projected to reach $890 billion in 2024, as per a report released by the National Retail Federation (NRF) and Happy Returns, a UPS company. Retailers expect that 16.9 per cent of their annual sales in 2024 will be returned.
Return policies influence the consumer behaviour throughout their shopping experience. Seventy-six per cent of consumers consider free returns a deciding factor in where to shop. Sixty-seven per cent say that they would not shop with a retailer again if the return experience is unpleasant, while 84 per cent of consumers report repeating a retailer offering no box/no label returns and quick refunds.
Shoppers are also aware of the impact of return flexibility at the initial point of purchase. Sixty-eight per cent, more than two-thirds of the retailers surveyed, reported prioritising their returns capabilities within the next 6 months. Reducing the return rate while improving the return experience are among the top goals, businesses aim to achieve.
However, fraudulent returns remain an issue among retailers with 93 per cent of retailers reporting the significance of the exploitive behaviour. Purchasing multiple items with intention to return some is growing among younger consumers, with 51 per cent of Gen Z consumers admitting practicing the same, the report said.
Another NRF study noted that retailers expect a 17 per cent higher return rate for the 2024 winter season than the annual return rate. However, around 34 per cent of retailers are hiring additional staff to handle returns and 40 per cent are taking support from third party logistics providers to manage increased returns.
“Returns play an important role within the retail ecosystem and offer an additional touchpoint for retailers to provide a positive interaction with their customers. Retailers recognise the value of returns and their integration with brand loyalty, and many are prioritising their returns capacity to ensure a seamless customer experience,” NRF vice president of industry and consumer insights Katherine Cullen said in a press release.
“Return policies are no longer just a post-purchase consideration – they are shaping how younger generations shop from the start, with behaviours like bracketing and rising return rates putting strain on traditional systems, retailers need to rethink reverse logistics. Solutions like no box/no label returns with item verification enable immediate refunds, meeting customer expectations for convenience while increasing accuracy, reducing fraud and helping to protect profitability in a competitive market,” said David Sobie, co-founder and CEO of Happy Returns.
Retail returns are projected to hit $890 billion in 2024, with 16.9 per cent of sales expected to be returned.
Free and seamless returns drive loyalty, while 93 per cent of retailers report concerns about fraudulent returns.
Retailers are enhancing return capabilities, with 34 per cent hiring staff and 40 per cent using third-party logistics.
Fibre2Fashion News Desk (HU)
