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America has a problem with online shopping.
Retailers have catered to consumer demand by making the online shopping experience a little easier. You can buy an item with as little as two clicks – and by the time you wake up in the morning, a little brown box will be waiting for you at your door.
But convenience comes with a cost – one that is now being passed on to consumers.
You now have to spend money to return your online order
At the start of the COVID-19 pandemic, some Americans clicked-happy with their online purchases and faced stay-at-home restrictions. in 2020, E-commerce sales up 43 percent Compared to 2019.
But many of those purchases were not a good fit, which created a headache for retail brands to bear the return process. According to the National Retail Federation, in 2021, online return rates averaged 20.8% — an increase of 18.1% from a year earlier.
Supply chain issues have made every step of the return process more costly as compared to pre-Covid times. The retailer’s profits have taken a big hit due to increased shipping, transportation, fuel and wage costs. According to Optoro, a reverse logistics technology company, $50 items Retailers cost an average of $33 to return in 2021, marking a seven percent increase in the cost of handling the return process over 2020.
When it comes to returns, “it’s gotten out of hand with some retailers,” says Thomas Borders, vice president and general manager of Product Lifestyle Cloud at Inmar Intelligence. “And those are the retailers you see that are starting to charge the consumer to return the merchandise.”
Popular brands including Zara, JCPenney and DSW now deduct shipping fees from refunds for most online orders returned by mail. For example, JCPenney now charges a similar $8 shipping fee for online returns by mail. And others may soon follow.
Increase in cost in the labor-intensive return process
The return process is long and cumbersome, but consumers are largely unaware of the work that goes into handling the returned items.
A recent survey conducted by Inmar Intelligence and provided to Forbes Advisor found that despite more than half of respondents shopping online at least once a week, one-fifth of them are not aware of it. That’s what happens to the items they return.
Items are validated, inspected for wear or use (Inmar says workers go as far as sniffing clothes to make sure they haven’t been worn), replacing or adding a hanger, folding Doing and then finally bagging. According to Inmar Intelligence, all of these operations can cost up to $7 per item—and do not include shipping costs to the return processing location or the cost of fulfilling and shipping an order when an item is resold.
Borders says some items may not even be stocked. Fast-fashion brands, for example, usually release trendy items; By the time the withdrawal process is complete, the company will already be selling the next trend. In these cases, the returns are sold at a discount retailer – or worse, ends up in a landfill,
Is Free Return a relic of the past?
Borders says retailers are likely to implement strategies that reduce online shopping, including cutting back or limiting free returns.
,[Removing free shipping] One of their major efforts is to reduce online overbuying, where people feel there is no result because they can eventually return it if they don’t like it,” Borders says. He adds that the brand Orders will also increase your free shipping minimum on purchases to prevent overbought. Consider free shipping for purchases of $75 and above instead of a minimum of $50.
Some retailers are also considering giving customers keep their unwanted belongingsBecause of a pandemic-related inventory glut, the cost of storing that surplus plus the compounding cost of returns.
While this may seem like a win-win for consumers and retailers, Borders says it places an undue burden on customers on knowing how to dispose of unwanted items.
“People don’t want things for a good reason,” Borders says. “It also has harmful effects, I don’t think many people consider. You can’t just throw everything in the trash.”
The limits specifically point to merchandise such as electronics that may contain harmful materials inside. They can be improperly disposed of when customers do not want to keep them.
Clothing waste is also harmful to the environment. The average American throws around 70 pounds clothes and every year other garments—many of which end up in landfills, have since 60% of textiles are not recyclable,
How to avoid return cost
The holiday shopping season is near. If you want to maximize your purchases—and avoid incurring return fees—consider these tips.
return items to a store location
Although sending a return is usually more convenient, many retailers encourage customers to do it in-store for free. Check the store’s return policies before checking out online to avoid any unpleasant surprises you may need to make a return.
Avoid gift giving from fast-fashion retailers
is fast fashion problematic for various reasons, including damage to the environment. But fast fashion retailers are also more likely to pay online returns than brands with a higher price-point, Borders says.
Because of “bracket” ordering, where consumers purchase items of multiple sizes or colors to try at home, some consumers buy much more than they intended to keep from these retailers – and return costs increase. If you plan to buy multiple sizes for yourself or someone else, what you eventually return may result in a fee deducted from your refund.
If you must order from these retailers, make sure they have a physical store near you so that you can return unwanted items for free. Another thing to keep in mind: Some stores, such as Old Navy, don’t accept online returns for certain items at their physical locations. Be sure to read the store’s return policy.
give gift card
At some point, giving gift cards as a gift was seen as cliché or thoughtless. In fact, they can help both the donor and the recipient save money. If you want to give clothes as a holiday gift this year, instead of playing the guessing game with sizing, give a gift card.
if you frequently rewards or cash back credit cards Users, you can be able to redeem points or cash for gift cards. Visit our Rewards Portal for more information.