NEW YORK (Reuters) – As shoppers keep the latest Christmas presents under the tree, U.S. retailers are preparing a record flood of online gift returns purchased during the deadly rise in coronavirus cases. To make the process more efficient, retailers such as Walmart Inc and Target Corp. allow buyers to leave unwanted gifts at FedEx or United Parcel Service delivery points.
Others, such as Best Buy, Dick’s Sporting Articles and Nordstrom, are offering profitability on the brink for the first time, as efforts to stop the spread of COVID-19 have closed stores or reduced the number of customers allowed inside.
Yields will increase this year. Shoppers trying to avoid the contagion moved from online stores, where return rates are historically higher. Retailers are also under pressure to make the process as smooth as possible for buyers who want to retain both customers, as well as UPS and FedEx, which are flooded with packages.
Some malls are even moving to facilitate the return of their tenants. Mall of America and Simon Property Group have partnered with Narvar, a return management provider, to eliminate the need for buyers to print return labels on packages they leave behind.
The National Retail Federation expects holiday sales for 2020 to increase to 5.2% from last year to $ 766.7 billion. About 13 percent of the merchandise, or about $ 101 billion worth of merchandise sold during the 2020 holiday season, will be returned, the trading group said.
Optoro, which helps retailers order, resell and dispose of returned merchandise, makes the number even higher. He predicts that the return of the 2020 U.S. holiday will reach $ 115 billion between Thanksgiving and the end of January. This is an increase of 15% over the 2019 forecast issued by the firm, which has UPS and IKEA furniture retailer among its investors.
The rate of return of clothes to the store is 5 to 8%, while online is around 30%, said Rob Zomok, president of global operations of Inmar Intelligence, which processes approximately 600 million annual trade returns retail and electronic.
“These maths have created a significant increase in yields,” said Zomok, who added that clothing yields are on record.
“When your purchases are 100% online, you probably order a couple more (items) with the intention of returning,” said Sriram Sridhar, CEO of LateShipment.com, which helps customers track packages.
“We expect all retailers to face around 50% more returns than they have faced in recent years during the holiday season,” Sridhar said.
In addition, retailers also quarantine or disinfect products after returning them to make sure they are free of the virus.
“This is not the typical way to process returns,” said Paula Rosenblum, managing partner of retail research firm RSR Research.
Kohl’s, which collects Amazon.com returns and sends them en masse by email, has extended its own deadline for premium electronics.
It joins a wide range of retailers, including Walmart, Macy’s and Amazon, which give shoppers more time to return purchases, which could make it difficult to resell seasonal goods.
Getting these products to be resold for resale is vital, especially for fast fashion retailers who sell trendy clothing, Zomok of Inmar said.
“The window will be short,” Zomok said.
Anna Driver Reports; Editng by Aurora Ellis