A huge increase in online shopping during the pandemic it has been a savior for retailers, but it has a price.
Buyers are expected to return twice as many items as during last year’s holiday period, costing companies approximately $ 1.1 billion, according to Narvar Inc., a software and technology company that manages online returns of hundreds of brands.
Retailers don’t want to get the return, but they do want shoppers who don’t feel safe going to the stores to feel comfortable buying things they haven’t seen or tried in person.
People have been making so many online purchases since March that carriers like UPS and FedEx were already in full swing before the holiday shopping season. And online sales keep firing. From Nov. 1 through Tuesday, online sales rose 32 percent to $ 171.6 billion, compared to the previous year, according to Adobe Analytics.
The massive challenges of COVID-19 vaccine transport in the coming weeks and months could put additional pressure on the delivery system. This means shoppers who return items may not get refunds until two weeks after returning them to the store, said Sara Skirboll, a purchasing expert at the retail site RetailMeNot.
“Great time to be in the returns business”
Many companies offer more locations where customers can leave returns, which reduces shipping costs and gets refunds to buyers more quickly.
Last year, Kohl’s began allowing Amazon to return to all of its 1,000 stores – customers leave items for free, with no tags or labels. This year, Amazon customers can also return items to 500 Whole Foods Market stores. This is in addition to Amazon’s agreement with UPS to allow similar returns to UPS stores.
Walmart, the nation’s largest retailer, announced earlier this week that it will collect items shipped and sold by Walmart.com from customers ’homes for free through a new partnership with FedEx. The service will continue beyond the holiday shopping season.
Happy Returns, a Santa Monica, California-based startup that works with nearly 150 online retailers like Rothy’s and Revolve, has increased the number of locations to 2,600, from more than 700 last year. This includes 2,000 FedEx locations.
“It’s a good time to be in the returns business. Every day there is a record,” said David Sobie, CEO and co-founder of Happy Returns, who noted that he processed 50% more returns in December than in December. November.
But the ease of e-commerce creates many environmental costs as well as costing retailers a lot. Last year, online shopping yields created 5,000 million tonnes of landfill waste and produced both carbon dioxide and from 3 million cars they drove for a year, according to Optoro, a company return logistics.
Shops for shoppers: just keep it
A growing number of retailers are asking buyers not to even bother to ship certain discarded items.
When Dick Pirozzolo wanted to return an oversized t-shirt he bought for $ 40 on a website called Online Cycling Gear, he was pleasantly surprised by the response. The site told him to keep it, discard it, or deliver it to a friend or charity, and sent it the right size for a $ 10 supplement.
“I was fine with that,” said the 77-year-old cycling enthusiast from Wellesley, Massachusetts. “I did something good for a friend and got a new shirt.” The experience, he says, has given him confidence to buy more this holiday online.
David Bassuk, global co-leader of AlixPartners ’retail practice, says stores are making it easier for shoppers to feel less guilty about returning items.
“If they’re not sure of their size, they order both sizes,” he said. “If they’re not sure what color, they ask for both colors. And if they don’t know which item, they ask for them all. But it’s expensive for retailers and retailers aren’t well positioned to handle all the costs.”
According to a Narvar report, the practice of buying various sizes or styles of an item, known in the industry as “bracketing,” has increased by 50% during the pandemic. “Consumers were already in the habit of using their bedrooms as appliances to buy online, but the practice skyrocketed this year,” Narvar found.
On average, people return 25% of the items they buy online, compared to only 8% of what they buy in stores, according to Forrester Research online analyst Sucharita Mulpuru. For clothing it is even larger, about 30%.
But not all rejected items are the same and have different levels of depreciation, according to experts. After sending an item to the retailer, the company must assess its condition and decide whether to resell it, send it to a liquidator or landfill.
Optoro estimates that the value of fashionable clothing depreciates between 20% and 50% over a period of eight to 16 weeks. That’s why it’s so important to retrieve discarded items and resell them quickly.
Impact of Black Friday in the early days
Returns are also tricky this year, as retailers pushed people to buy holiday gifts early to avoid shipping delays and crowded stores, which means the return window can close when the Christmas festivities are all around.
Amazon allows customers to return items until January 31 for items shipped between October 1 and December 31, giving them more time to decide. Last year, the policy did not include articles submitted in October.
Rachel Sakelaris, 25, of Newport Beach, California, bought her boyfriend a waterproof backpack on Black Friday and realized there was a 30-day return policy. He decided to change the gift exchange last weekend, so he had time to come back if he didn’t like it.
Buying too soon can lead to other dangers.
Sarah Huffman, 40, of Chesapeake, Virginia, wanted to start skipping the holiday season and spent $ 600 on Amazon on gifts, including $ 60 pajamas and a $ 90 Xbox game for her five children , in May.
But then her husband, a disabled veteran, quit her job because she felt her boss was too lax with COVD-19 safety protocols. Now, his family struggles to put food on the table and cannot return some of the gifts he bought because the return window has expired.
“I was trying to eliminate the stress of the pandemic by buying early,” he said. “I didn’t realize that basic life choices would find a new minimum.”