This holiday season, returns are up and so is the cost of making them. More than four in five merchants now charge customers a fee to ship back or return an item that they don’t want to keep, according to Happy Returns, a logistics firm that works with online merchants to handle product returns. (The company was recently sold by Paypal to UPS.)
The practice of charging for returns isn’t entirely new: Since April, Amazon has been charging customers a $1 fee if they return items to a UPS store when there is a Whole Foods, Amazon Fresh grocery store or Kohl’s—an Amazon partner since 2019—closer to their delivery address. Macy’s, Abercrombie, J. Crew, H&M, and other companies have all added shipping fees for mail-in returns in recent years, as CNN has noted.
Fast-fashion chain Zara allows for free in-person returns at its stores but deducts $3.95 from the refund value for mail-in returns. American Eagle charges a $5 fee for the same, while J. Crew deducts $7.50 and JC Penny charges $8. T.J.Maxx burns one of the biggest holes in the returns receipt, charging $11.99 for shipping and handling of returns that are not done in person.
Shopping returns, by the digits
94%: Share of shoppers who are willing to travel up to two miles for free, in-person returns
59%: Share of merchants that say shoppers opted for the least expensive return option
15%: Share of merchants that posted return rates upwards of 20% in 2022
47%: Share of merchants that posted return rates upwards of 20% in 2023
(All statistics are from a recent report by Happy Returns.)
Define this: “Bracketing”
“Bracketing” is when online shoppers buy multiple items with the intention of returning at least some of them, perhaps to try on an article of clothing in multiple sizes or colors. The growing practice is most popular among Gen Z, with 86% of them opting for “bracketing” when they shop. The older the shopper, the less likely they are to bracket-shop.