Holiday shopping is projected to reach record levels in 2024, with an estimated 17% of all merchandise sales expected to be returned, totaling $890 billion in returned goods. This is an increase from 15% in 2023, according to the National Retail Federation and Happy Returns. The holiday season sees a higher rate of returns, with retailers expecting a 17% higher return rate during this time compared to the annual rate.
The rise in online shopping during and after the pandemic has led to an increase in returns, with customers engaging in practices like bracketing and wardrobing. Processing returns costs retailers an average of 30% of an item’s original price, with the environmental impact also being a concern. Many returned goods end up in landfills, contributing to waste and carbon emissions.
To combat the issue of returns, some retailers have implemented stricter return policies, while others offer options like buyback programs or selling returns to secondhand businesses. Some retailers, like Amazon and Target, allow customers to simply keep the product and receive a refund. Return policies now play a significant role in shaping consumer behavior, with free returns being a key factor for 76% of shoppers in deciding where to spend their money. Overall, retailers are looking for ways to improve the returns experience for customers while also addressing the environmental impact of returns and reducing waste.
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