Retailers prepare for $90B worth of holiday gifts to be returned in 2020

Shoppers may love ordering stuff online, but when it comes to returning that holiday sweater, many would rather drop it off at the store.

That consumer aversion to shipping back unwanted goods could give bricks-and-mortar retailers an edge in the post-holiday hangover even as online sales continue to soar.

Consumers are expected to return between $90 billion to $95 billion worth of merchandise purchased over the holidays, according to B-Stock Solutions, which runs online liquidation sites for major retailers. That is a projected jump of 15% to 20% over 2018, and e-commerce orders are likely to account for nearly half of this year’s volume.

Many of those rejects will get dropped off at the sales counter as store owners refine their ability to handle consumer returns. For retailers, that can mean another crack at landing a sale.

About 80% of shoppers prefer returning or exchanging items in stores, and nearly three-quarters say they are likely to buy something else in the process, according to a National Retail Federation survey released this week.

Shoppers also factor return policies into buying decisions. Some consumers prefer in-store returns because they get faster refunds, according to a 2019 consumer survey by Narvar Inc., a digital-retail software and technology company. Nearly a quarter of respondents say that having to repackage an item is one reason they dislike the returns process.

Amazon offers no-cost returns at more than 18,000 drop-off locations that include its small chain of physical book stores, select Whole Foods Markets and third-party locations such as Kohl’s Corp. and UPS stores.

Santa Monica, Calif.-based startup Happy Returns has built its business on handling in-person returns for digital brands such as Everlane and Rothy’s at more than 700 kiosks in malls and stores around the country.

Source
https://www.wsj.com/articles/retailers-brace-for-bigger-holiday-returns-season-11576751402

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