The environmental toll of online shopping returns, highlighted in a report by CleanHub, underscores a significant challenge for retailers. With returns costing online retailers a staggering US$816 billion in 2022 alone, the impact extends beyond financial loss, encompassing 24 million metric tonnes of CO2 emissions and 9.5 billion pounds of returns sent to landfills.
According to CleanHub VP of Marketing Nikki Stones, the ease of returning items online contributes to this trend, fueled by the convenience-driven nature of online shopping compared to brick-and-mortar purchases. goTRG CEO Sender Shamiss, further emphasizes this issue, noting a dramatic increase in retailers considering returns a severe problem, particularly during peak shopping seasons.
Mr. Shamiss highlights the necessity for retailers to engage in the circular economy to mitigate this issue. He advocates for investments in reverse supply chain solutions, refurbishment, and restoration services to salvage returned items and reduce landfill waste. Collaboration with returns management providers could prevent millions of pounds of products from becoming landfill fodder.
Additionally, the report identifies excessive packaging, especially in the fashion sector, as a significant contributor to environmental harm. The high return rate for clothing exacerbates this problem with items often rendered unsellable after minimal use.
Despite these challenges, Mr. Shamiss notes a positive shift in retailers' approach to returns management. Investments in advanced return systems and customer education have led to a decrease in the returns problem, demonstrating the potential for positive change. Innovative returns strategies, including dynamic returns software and enhanced customer options, offer a promising path forward, potentially improving retention rates and mitigating losses due to fraudulent returns.
