Retailers Tighten Return Policies, Angering Shoppers
Online stores are increasingly charging fees, shortening deadlines, and scrutinizing return patterns as the cost of handling merchandise sent back by customers rises.
The era of nearly free and effortless online returns is drawing to a close as retailers implement stricter policies, leading to shopper frustration. A growing number of online businesses are now charging fees for returned items, reducing the time window for send-backs, and in some instances, warning customers that excessive returns could jeopardize future refunds.
Data from Loop Returns indicates that approximately 68 percent of retailers now charge for returns at least some of the time, a significant increase from 43 percent five years ago. The cost to process returns averages 27 percent of a product's purchase price, according to the returns-management firm Optoro.
Neil Saunders, managing director of GlobalData's retail division, explained that retailers are tightening policies after years of offering flexibility that encouraged consumers to return items liberally. "Returns are a costly part of ecommerce, and most of this stems from the fact that retailers have previously been flexible and liberal with policies which has encouraged consumers to take full advantage of returning things," Saunders told the Daily Mail. "That's now changing as retailers look to trim costs, and policies are being tightened with things like more restricted returns windows and sometimes charges."
While these changes may be sensible from a business standpoint, retailers are cautioned against alienating loyal customers. For shoppers, the primary source of anger often stems from discovering these stricter rules only after an order has been placed. Taylor Cunningham, a senior director at Trustpilot, noted that a lack of transparency often causes more significant backlash than the policies themselves. Trustpilot's analysis found that discussions about return policies are associated with a substantial drop in merchant ratings.
Some retailers are also shortening the time customers have to make returns. Loop reports that return windows among major brands have decreased by 12 percent over the past two years, from an average of 43 days to 38 days. Companies like Macy's, Talbots, and Home Depot have adjusted their policies. For example, Home Depot now offers only 30 days for certain seasonal decorations, and some portable heating and cooling products have a seven-day return limit, down from a previous 90-day window for similar items. A Home Depot spokesperson stated these changes align with industry standards for seasonal merchandise. Macy's, Talbots and Home Depot have all tightened their policies, with Home Depot now allowing just 30 days for certain Halloween and holiday decorations.
The underlying issue for retailers is the significant expense associated with processing returns. These costs include shipping, handling, payment processing, and inspection, especially when items cannot be resold as new due to opened packaging or condition changes.
Amazon has begun flagging certain listings as 'frequently returned' and has started asking customers for the reasons behind their returns. The company sends notifications to a small percentage of customers with return rates significantly higher than average, stating these are intended to help shoppers make more informed purchasing decisions. The Retail Equation, a third-party return-verification company, reports that about one to two percent of consumers it monitors receive warnings that their future return claims could be denied based on their patterns.
Some shoppers argue that retailers themselves fostered the generous return culture to encourage online purchasing, making online shopping feel virtually risk-free. They contend that free returns were initially a strategy to lure customers away from physical stores. Conversely, others argue that retailers have consolidated their online market dominance and are now implementing less consumer-friendly policies. The argument from heavy returners is that online shopping inherently lacks the ability to ascertain fit, feel, or appearance accurately from a photo or description. However, blame is also directed at consumers who allegedly order multiple sizes or use products before returning them, leaving retailers with merchandise that can no longer be sold as new.
Saunders advises consumers to carefully review return policies before purchasing, check sizes and fits, and consult product reviews to minimize the need for returns.