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New Report Finds Retail Returns Totaled $309 Billion in 2019 Impacting Stores and eCommerce

Appriss Retail’s “2019 Consumer Returns in the Retail Industry” report finds returns of Online purchases totaled $41 billion; return fraud up 35% over 2018.

Appriss Retail today released an analysis of the revenue and profit loss ramifications of U.S. consumer merchandise returns. The new “2019 Consumer Returns in the Retail Industry” report states that overall value of returned merchandise in the United States during the past year was $309 billion, and returns from online purchases accounted for $41 billion of that total. This cost does not include the overhead a retailer incurs when receiving, sorting, and repackaging useable goods for resale, nor does it account for the disposal of unsaleable merchandise. In addition, an estimated $27 billion of that sum were fraudulent returns, up 35% over 2018.

Return rates vary greatly by retail vertical; for example, drug stores/pharmacies showed a 2.1% blended return rate while auto parts retailers had a rate of almost 19.9%. Footwear and home improvement retailers also tracked higher than the 8.1% average return rate. The report contains the blended return rate for 10 retail verticals, and also tracks return rates by original payment type.

“Return fraud is up 35% over last year, at the same time that retailers are struggling to find a balance between making returns as frictionless as possible and keeping costs in check,” said Steve Prebble, president of Appriss Retail. “While many types of returns can be risky for the retailer, there are ample rewards to be earned when consumers have a friendly in-store interaction. We hope that the report invites further discussions about how retailers can improve their customer experience and optimize the profit potential of service-oriented options like buy-online-return-in-store (BORIS).”

- Digital Partner -

Other highlights from the report include:

  • Total merchandise returns account for $309 billion in lost sales for US retailers, including $41 billion from returns of online purchases. This revenue size would rank #2 on the Fortune 500.
  • Annual losses from merchandise return fraud are estimated at $27 billion, up 35% over 2019.
  • The estimated return fraud percentage of 8.8% is 76% higher than last year.
  • The largest risk for online returns is in-store. BORIS (buy-online-return-in-store) return fraud is $1.6 billion compared to $0.4 billion for non-store locations.

The full report is now available for download here.

Managing in-store and online returns is a major challenge, especially while retailers are also looking to differentiate the consumer experience during the return process. Appriss Retail can help address such challenges through a return optimization solution called Verify®. It is designed to enable a great shopping experience, but still distinguish and deter the one percent of consumers that are fraudulent and abusive.


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