Should we start charging customers for returns?

Should retailers impose a return fee on customers?

This is the burning question that’s been repeatedly put to our team during the past 12 months. Whether it’s at industry events or fielding new tender enquiries from retailers and consumer brands, it’s becoming more and more of a conversation starter.

It’s clear that returns – and the associated processing costs and possible charges for shoppers – are causing businesses a headache, so much so, that we decided to survey 1,000 consumers nationwide to show why the answer to ‘returns charges’ is a resounding NO, and to create this free eBook to help provide clarity about how to tackle this conundrum.

Shoppers are actively interested in returns policies, and they can influence purchasing decisions.

35% of consumers always check a retailer’s returns options before placing an order, while half (51%) will search for this information when thinking about ordering from a retailer they haven’t used before.

The three most important returns factors for shoppers include:

  1. 62% want free-of-charge returns.
  2. 58% want returns processed quickly, so they receive a fast refund.
  3. 56% expect it to be quick and easy for them to send items back.

In addition to ‘free-of-charge’ returns ranking as a top priority, the research also found that two thirds (65%) of consumers said they’d be less likely to shop with a retailer that charges for returns.

With these figures in mind, it seems high risk for retailers to start charging customers to send items back, and even more so during the cost of living crisis when people are aiming to make their money go further.

Yes, charging for returns may help to off-set rising processing costs, but it’s also likely to negatively impact sales and revenue. The latter could prove much more detrimental to the bottom line than the costs incurred during reverse logistics.

We work with retailers and consumer brands to embrace returns, and rather than obsessing about charging customers, we focus on integrating returns as an effective and efficient part of supply chain management strategies. This helps to:

  • Reduce losses by optimising the value of returned inventory.
  • Enhance stock availability, so that returns don’t mean missed sales.
  • Improve sustainability by minimising wastage of returned goods.

These benefits can generate savings, which mitigate margin dilution caused by items being sent back, and help make no-cost returns feasible, so that retailers and consumer brands can avoid hitting shoppers with extra costs that risk deterring sales and satisfaction. Find out more in our free eBook, click here to download.