Retailers are increasingly adopting “keep it” or “returnless” policies for unwanted products.
The adoption of these policies is a response to the rising costs associated with returns and the need to streamline operations and retain customers, Reuters reported Thursday (Nov. 30). By allowing shoppers to keep unwanted items that would be costly to return, retailers can save on transportation and reselling expenses.
Fifty-nine percent of retailers now offer these policies, compared to 26% last year, according to the report, which cited data from returns services firm goTRG.
The increase can also be attributed to retailers adopting technology to reduce excess costs associated with returns, the report said.
Returns can be a drain on retailers’ profits, as they require additional resources to process and often result in items being sold at a discount or disposed of at a loss, per the report.
Returnless policies are one of many strategies retailers are adopting to manage returns more effectively, according to the report. Retailers are also offering store credit, charging for returns and encouraging shoppers to bring online purchases back to physical stores.
The adoption of returnless policies has been driven by various factors, the report said. Sellers of items like underwear, bedding and food were among the first to adopt these policies due to hygiene concerns or health safety rules.
The eCommerce boom during the early stages of the pandemic further accelerated the practice as shipping and delivery costs increased, and warehouses became overwhelmed, per the report.
The adoption of returnless policies allows retailers to save on transportation, sorting and reselling expenses associated with returned items, according to the report. Additionally, it helps prevent supply chain backups and reduces the need for warehouses to handle and store unwanted products.
While some retailers have embraced returnless policies, they prefer not to disclose the use of these policies publicly due to concerns about potential abuse by shoppers, the report said. However, customers interviewed by Reuters reported being told to keep items valued from $20 to as much as $300 that were defective or incorrectly shipped.
Inviting customers to keep an item rather than returning it saves costs and gives consumers “ammunition to say good things about us,” Alex Brown, CEO of sustainable cleaning supplies subscription firm Truly Free, told PYMNTS’ Karen Webster in an interview posted in May.
“We want to build advocacy,” Brown said. “I think that’s a better way to do it.”
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