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Jennifer Howe still has her unwanted Christmas presents: slippers that are too big, designer perfumes she’ll never wear, and candles.
“It looks nice, but I’ve never been a fan of candles,” she said.
she’s not wrong Retailers are now making returns harder, more confusing and potentially more expensive. What difference will a few years make?
During the pandemic, retailers have bent backwards to make returns easy and seamless for Americans at home. I was hoping that would continue shopping.
Given that a healthier retail environment is now combined with other factors (namely rising costs of doing business), retailers are cracking down.
In fact, six out of 10 retailers changed their return policies in the last year alone, according to a logistics company focused on returns.
Changes include faster refunds and returns, shipping and restocking fees, and other surprises, according to goTRG President and CEO Shender Shamiss.
Consumers like Nick Mueller find it the hard way.
“I recently tried to return an item of clothing from REI and was surprised to find that they charged me $6,” Mueller said.
“Returns are costing too much and retailers are trying to protect their profits,” says George Trantas, global marketplace director at , a leading provider of cloud-based tax compliance automation for businesses of all sizes. senior said.
“The cost of returns can be $30 or more per item. You have shipping costs, labor costs, return shipping costs, labor costs to put the items back on the shelf, and the initial markdown,” he said. “How can retailers get their original prices back? They can’t.
Shamis agrees.
“As much as 85% of the value can be lost in the process of returning an item,” says Shamis.
The returns problem has been around for some time, but now it’s reached a “tipping point,” Trantus said.
Consider this past holiday season.
According to the latest data from the National Retail Federation, on average, retailers expected to return 17.9% of the items sold during the holiday shopping season. This will increase him from 16.6% in 2021 to about $171 billion.
Few companies are in a position to pay such a hefty price tag.
Online returns are the most problematic, Shamis said.
“This is the challenge,” Shamis said.
Enough with retailers like Zara, H&M, and other chains. They now charge a fee of up to $7 to return items online.
“This is part of the solution because it drives foot traffic, secondary sales, and loyalty by driving customers into the store. increases by up to 95%” .”
Trantas said there is also a need for greater transparency and communication.
“Retailers need to be very clear about their return policies to eliminate consumer frustration and friction. The new norm is ‘know your policy.'”
Personal finance journalist Vera Gibbons is a former staff writer for SmartMoney magazine and a former correspondent for Kiplinger’s Personal Finance. Vera, who spent more than a decade as an on-air financial analyst for MSNBC, now co-hosts the weekly non-political news she founded podcast. No PoShe lives in Palm Beach, Florida.
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