Let this number sink in: More than 14% of all purchases made at retail last year were returned.
Back in the good old days you had 10 days – maybe 30 at an upscale store – and you had to have a receipt. Well, those days are long over and returns to retailers have been exploding the past few years. Now the National Retail Federation estimates that returns in 2023 will top $743 billion – that’s billions with a “B” -- and not only that, but nearly 15% of it was fraudulent.
Working with the analytics firm Appriss Retail, the NRF charted these numbers based on responses from 60 of the 100 largest retailing companies in the country.
Returns using counterfeit receipts, coming from goods shoplifted by individual or professional criminals and other fraud and abuse amounted to about $101 billion last year, the organization said. And while there has been some pushback on crime numbers and individual retailer’s claims of problems, there’s still no disputing that overall the return situation is a big headache for the retailing industry and ultimately for the vendors who supply them.
Blame it a lot of factors from the economy to reduced staffing at retail stores but the NRF points its finger at one factor specifically. “Digital growth has an increased impact on in-store returns rates and leads to a significant increase in online claims and appeasements for missed, late, or damaged deliveries. Fraud and abuse are growing at a significant pace in this category.”
Retailers are fighting back on returns, the two organizations said by shortening return windows, charging return fees, requiring identification and limiting refunds to store credit. Amazon is only the latest big online player to move to a stricter return policy and chances are consumers will be faced with more of this as the year progresses.