With the “Returnary” month an option to return goods is now part of shopping habits

Today, more than three quarters of shoppers consider return options when deciding which retailer to spend their money with. This can be an annoyance for shopkeepers, but can bring some money into LSP’s kitchens. After a strong shopping season, experts expect a similarly strong “Returnary” month.

The 2024 shopping season is off to a strong start in the US, and experts forecast consumer spending to hit a record high this year. As is the norm, shoppers would return some of the products they had bought back to the sender. According to CNBC “returns”, are becoming a big business for the shipping industry.

December of the New Year is the peak shopping season, followed immediately by the first month of the New Year, which is the strongest time for returns. That’s why experts have twisted the English word January to call these few weeks Returnary. In 2024, shoppers in the US returned 17 percent of the goods they sold to stores and department stores.

This was worth $890 billion, according to data from the National Retail Federation (NRF). This is almost four and a half times our homeland Hungary’s annual GDP. The value and share of return could be noticeably higher than in 2023. Then, 15% of goods sold have later been returned to the sender at a value of $743 billion.

January differs from the other months in that it receives a much higher than average share of the annual returns. In other words, Returnary’s share is expected to be much higher than 17%, which will put a strain on retailers and their supply partners.

For retailers, return is a major headache

The ideal would be to see a reduction in returns, but the reality is that we don’t really expect that to happen,” said Amena Ali, CEO of Optoro, a company that offers return services. It’s no coincidence that a number of companies like this one have been set up with the profile of taking over the management of returns from retailers.

It was not only online shopping that became a habit that many have maintained ever since during the coronavirus epidemic, but also the favourable return options. A behaviour has emerged whereby the customer is effectively a pseudo-buyer because he has no intention of keeping the goods he orders online.

Almost two thirds of online shoppers have the product delivered in several colours or sizes, only to decide afterwards which one they want to keep. The rest go back to the sender. This practice is known as “bracketing”.

Even higher, at 69%, is the proportion of people who have taken up the habit of “wardrobing”, according to Optoro’s experience. This type of return increased by almost a quarter in 2024 compared to 2023.

Almost half of customers are “compulsive” returners

It is mainly these two habits that explain why 46% of shoppers return several items a month to online shops. The number of these increased by 29% in 2024 compared to 2023 in Optoro’s practice.

And it’s certainly costing retailers a lot. That’s why they’re tackling the problem under the separate term ‘reverse logistics’, says David Sobie, CEO of Happy Returns, a specialist returns logistics service.

According to Optoro’s calculations, it costs retailers on average 30% of the price of the goods they sell to return them. Since in the vast majority of cases the product is not returned to the virtual or real shelves of the store, returns are a hole in companies’ sustainability commitments.

Returned goods have to be repacked, stored, sold – sometimes exported – provided, of course, that they are returned to the wider commodity cycle. Returned products often end up in landfills and only 54 percent of their packaging was recycled in 2018. (This is the last year the U.S. Environmental Protection Agency collected data on this.)

Optoro estimates that 3.8 billion kilograms of waste will be generated from returns in 2023. In tonnes, of course, that would seem less, but you can imagine how much of the clothes weighing a few kilograms it took to make up that amount.

Tightening up the rules on returns, with mixed results

Retailers are trying to make it harder to return. A Happy Returns survey, for example, found that more than four-fifths of retailers have shortened the time they have to return returns and started charging a fee for repeat returns. One of their key goals for 2025, the executives say, is to cut storage and shipping costs for returns.

The biggest companies, led by the likes of Amazon and Target, also allow up to a certain limit for a customer to keep a return item without paying the price. This method is used by 33% of retailers. Another option is to sell returned goods as second-hand items. Several specialised online shops have been set up in recent years.

However, retailers and their logistics service providers have to face the fact that return is embedded in consumer behaviour. This is particularly true for younger people, the millennials and Generation Z born between 1980 and 2010.

NRF’s survey found that 76% of online shoppers also consider the return policy of online retailers when deciding which one to buy from. A study of a sample of 1,500 people by online hosting provider GoDaddy found a slightly higher proportion, 77 per cent, to be in favour of this behaviour.

logMASter return service for all customers who use our fulfilment services

logMASter is offering full return services for the customers who use logMASter’s fulfillment services package. We are providing full scope of logistic B2C services to our customers including reverse logistic. The buyer can order for pickup directly with us so that we will collect the product on a next day basis and provide sorting of returns according to our customers’ requirements. We are committed to provide a one-stop full service to our B2C retailer partners.