Returning a package involves a series of tedious tasks: repacking, relabeling and visiting your local carrier to ship it back to its rightful warehouse, to start.
In a zeitgeist where online shopping is predominant, you’re more likely to avoid buying a product if the return costs you more money or effort than you're willing to spend. In fact, according to a recent survey by Pollen Returns, over 43% of respondents noted that it's inconvenient to do an online purchase if the return involves printing a label, packing the item, taking it to a logistic service provider and/or waiting for a refund. (From my own shopping experiences, I’ve stopped purchasing from one of my favorite retailers due to the constant added stress of sending their products back.)
As for brands, the return process can be easy or complicated, depending on the size of the delivery package. According to the National Retail Federation, the number of returns in U.S. retailers accounted for about $816 billion in lost sales in 2022. Not only are brands affected by returns, but also consumers lose money and time in the process.
According to recent research conducted by Pollen Returns, over 98% of the 1,092 people surveyed said that they shop online, but 88% of respondents said they wished the return process from an online purchase was easier.
As retailers start shifting away from a free return model, how are consumers finding efficacy and decreasing inconvenience when it comes to returns? Co-founder of Pollen Returns, Christian Piller, believes that some retailers are channeling a new return approach and studying consumers' behaviors while analyzing how they can give customers what they want at a more reasonable cost.
“However, both things come with a cost attached and retailers are effectively subsidizing expensive customer behaviors. With retail margins and profits under pressure, more retailers are looking at how they can reduce the cost of online fulfillment and returns. This has to be done sensitively, however, as consumers have become used to getting these things for free,” says managing director and retail analyst at GlobalData Retail, Neil Saunders.
Shipping remains cost-efficient (at a cost)
While some retailers are balancing their profits with a change in their return policy, most brands continue to offer free shipping.
“From a macro-perspective, shipping has gotten more expensive. Whether that is increased cost in fuel, increase cost of labor [or] the complexity in logistics, the last two years, since the pandemic, it accelerated the cost of moving something from point A to point B,” says returns expert and CEO of B-Stock Solutions, Marcus Shen. “I’m sure that’s a huge driver of people rethinking all the things that we’ve been taking for granted from an e-commerce perspective."
“For some categories with rich margins, such as apparel and beauty, this isn’t too much of an issue. However, for others with thin margins like grocery, this can mean free shipping pushes online selling into a loss,” adds Saunders.
Amazon is one retailer that is adjusting their delivery methods by driving customers to use Amazon pickup locations with their promotion providing $10 off select purchases. According to Piller’s analysis, this strategy helps Amazon gain insight and data while understanding which products customers are willing to pick up and which ones they prefer to be delivered. (If you have an Amazon Prime membership, you already have a two-day free-shipping option with some items being delivered the same day.)
Additionally, this will also impact Amazon’s brick-and-mortar strategy. According to Piller, Amazon will know “where they need to build additional stores, fulfillment centers and delivery stations, know which items need to be stocked in each location, etc.”
Shorter periods for returns
According to data from Sourcing Journal, retailers are experiencing an increase in purchase returns due to an excess of inventory from 2022.
"Retailers don't want to take aged inventory and take back, for example, a coat in March. That’s one of the reasons why retailers are trying to disincentivize consumers from doing returns," says BDO USA national managing partner Natalie Kotlyar.
Currently, many retailers have adjusted their return policy by shortening the period of returns from 60 days to 30 days, but some have drastically cut their return periods to 14 days whether you return by mail or in-store.
In reality, shoppers are more likely to abandon their shopping cart if the retailer presents a challenging return. According to data from Happy Returns, 50% of shoppers have abandoned a purchase because the merchant did not offer a convenient return method.
With so much inventory left, online stores are trying to shorten the return period so customers have less time to make a return decision. "Retailers want to liquidate inventory and turn it into cash because they have their own inflation and interest rates they are dealing with," adds Kotlyar.
Retailers charge a fee for returns
Online retailers are finding new ways to cash in and convert lost sales into purchases. With so much excess inventory from the second half of 2022, some retailers are charging a fee for returns.
"In general, 20% of all online purchases are returned, and as e-commerce value increases and we’ve seen in the past year, the number of returns is increasing. The return rate stays the same but there are more packages and the current way of doing things is extremely expensive, which is why some retailers are getting into charging for returns," says Piller.
In a survey conducted by Happy Returns, it was shown that 26% of merchants started charging for returns in the last year, while 16% were considering charging for returns in 2023. This method is helping retailers to recover the costs from lost sales and returns.
For example, Amazon charges a $1 fee for returning a package at a UPS location instead of dropping it off at a Whole Foods or Amazon Fresh store. This initiative is not only to freeze pre-pandemic consumer habits, but to balance the loss from returned goods.
"Just returning the product itself probably costs the retailer $12, and that doesn’t include the cost of processing, restocking and the loss of selling something at a discount price through liquidation. So offering for free when the return cost a minimum of $12 [is] a challenging value proposition for these retailers to continue to stomach the full cost," adds Piller.
In-store flexible returns
“Now returns can be free if returned into the store and brands that have those locations can convert those losses into another purchase,” says Kotlyar.
The buy online, pick-up in store model is an advantage brick-and-mortar retailers like Walmart and Target are renowned for, but e-commerce brands are also providing in-person methods for returns. For example, Amazon customers can easily return their packages at any Kohl’s location and they will pack, label and ship your return for free, while Ulta Beauty stores will accept returns from Revolve.
Another retailer that continues offering competitive free shipping and returns is Zappos. Merchandise can be returned within 365 days from the time of purchase. Also, you can avoid repacking and shipping it off by returning your Zappos merchandise at Whole Foods for free.
Retailers offer store credit for returned goods
One way retailers are improving the post-purchase experience is to offer customers a store credit if they decide to return. "From a retail perspective, they already have the cash; usually that credit goes unused and is free money for the retailer [anyways]," shares Kotlyar.
Other brands offer consumers a free-shipping label and a drop-off location through a third-party conglomerate to facilitate the return process.
Walmart return policy and bestsellers to shop
Any item sold and shipped by Walmart can be returned or replaced by mail within 90 days of receipt. You can also return the item in-store for a refund.
Nestl Bed Sheets Set
Summer Dress V-Neck Short Sleeve
Travelhouse 3-Piece Luggage Set
Miko Air Purifier
Target return policy and bestsellers to shop
Target return's policy also accepts returns for a full refund within 90 days for most items. To start an online return, you can use the Target app or go to Target.com to process the return or replacement using your order number.
To make the returns smoother, Target now offers a curbside return service at nearly 2,000 stores nationwide that allows customers to stay in their cars.
Beverage Dispenser with Spigot Gold
Naturium The Glow Getter Multi-Oil Hydrating Body Wash
Women's Gisele Strappy Heels
Sleeveless Linen Jumpsuit
Keurig K-Mini Single-Serve K-Cup Pod Coffee Maker
Zappos return policy and bestsellers to
Zappos offers free returns within 365 days of purchase and they offer a self-service return on their website. Also, you can log in with your Amazon Prime membership for additional Prime benefits.
Goldy Soul Tank Cover-Up Dress
Smokeshow Sleeveless Adjustable Rib Knit Mini Dress
Birkenstock Arizona EVA
Asics Gel-Nimbus 25
REI
All REI Co-op members can return their items for a replacement or refund within one year of purchases and non-members can return them within 90 days.
REI Co-op Active Pursuits 4.5” Shorts
REI Co-op Flash Hiking Boots
Parks Project National Parks Checklist T-Shirt
Other retailers with generous return policies
- American Eagle - AE accepts free returns within 30 days of purchase plus in-store and curbside pickup.
- Kohl's - You can return your product up to 180 days of purchase with some exceptions. Return exceptions include premium electronics, watches and beauty including items bought in Sephora at Kohl's or Wellness Market.
- L.L. Bean - While L.L. Bean charges $6.50 for returning items through UPS or U.S. mail, you can return them within one year of purchase.
- Nordstrom - This retailer accepts free returns in store or by mail with a prepaid return label. You can start any return here.
Meet the experts
- Marcus Shen is an e-commerce returns expert and CEO of B-Stock Solutions, the world's largest B2B marketplace for excess merchandise.
- Neil Saunders is the managing director and retail analyst at GlobalData Retail, a retail research and consulting firm, focused on retailing and consumer behavior.
- Christian Piller is the co-founder of Pollen Returns. His mission is to connect retailers with trusted logistics partners to provide shoppers with a front-door pickup experience at no additional cost to the retailer.
- Natalie Kotlyar is the national managing partner at BDO USA, the fifth-largest accounting and consulting firm worldwide.
