Retailers test new strategies to minimize returns

US retailers have been focused on efforts to mitigate returns, as total returns for the US industry amounted to $743 billion in merchandise in 2023, says a report by the National Retail Federation (NRF) and Appriss Retail. As a percentage of sales, the total return rate for 2023 was 14.5 percent. The report says for every $1 billion in sales, the average retailer incurs $145 million in merchandise returns. Online sales do see a higher return rate, with 17.6 percent or $247 billion of merchandise purchased online returned. That compares with 10.02% for pure bricks-and-mortar returns (excluding online orders that are returned in-store), or $371 billion. 

“Retailers continue to test and implement new ways to minimize losses from returns, particularly those that are fraudulent, while at the same time optimizing the shopping experience for their customers,” says Mark Mathews, NRF executive director of research. “Retailer’s efforts include providing greater detailed descriptions on sizing and fit of products for online purchases and requiring a receipt with returned items. As a whole, the industry is prioritizing efforts to reduce the amount of merchandise returned in stores and online.” 

This year, return fraud contributed $101 billion in overall losses for retailers. Moreover, for every $100 in returned merchandise, retailers will lose $13.70 to return fraud.