A report has found that consumers find return shipping to be the most annoying, with jury duty and the DMV coming in second and third place, respectively.

A report has found that consumers find return shipping to be the most annoying, with jury duty and the DMV coming in second and third place, respectively.
A report has found that consumers find return shipping to be the most annoying, with jury duty and the DMV coming in second and third place, respectively.
  • A recent report revealed that about one-third of consumers found paying for return shipping to be more frustrating than serving jury duty or visiting the DMV.
  • Here's why those return fees may only get worse.

Although many consumers enjoy online shopping, a significant number dislike the cost of shipping charges. Return shipping fees are even more disliked.

A recent survey of 1,500 adults by GoDaddy found that 77% of shoppers check the return policy before making a purchase. Additionally, nearly a third, 30%, of consumers said paying for return shipping was more annoying than jury duty and going to the Department of Motor Vehicles.

Winning over customers is important, and studies show that return fees are a crucial factor.

Miami is a hotspot for climate risk.

According to Optoro, retailers became more aggressive in charging for returns last year, with an average extra fee of just under $7.

According to Optoro, 37% of shoppers find the most frustrating aspect of making a return to be the shipping charge, while 62% of shoppers are less likely to initially shop with a brand that charges a return fee.

Optoro's CEO, Amena Ali, stated that while restocking fees and shipping charges can reduce the amount of inventory returned, charging for returns will negatively impact sales.

As the peak holiday shopping season intensifies.

Amy Jennette, GoDaddy's trends expert, advised businesses to examine how they might unintentionally be driving customers away.

Retail's return secret: What a 'keep it' policy means

Still, companies are doing what they can to keep returns in check.

A report from Happy Returns revealed that 81% of U.S. retailers implemented stricter return policies last year, such as shortening the return window and charging a return or restocking fee.

Amazon and Target have given refunds to customers without requiring them to return the product.

Ali stated that retailers are forced to find ways to control expenses.

Why returns are such a problem

In 2023, the return rate for U.S. retail sales was approximately 15%, or $743 billion in returned goods. For online sales, the return rate was even higher, at around 18%, or $247 billion of merchandise purchased online was returned, according to the National Retail Federation's most recent data.

During and after the pandemic, online shopping has become more popular, and customers have become accustomed to buying and returning products. As a result, more shoppers are ordering items they don't intend to keep. According to Happy Returns, nearly two-thirds of consumers now purchase multiple sizes or colors and then send back some of them, a practice known as "bracketing."

But all of that back and forth comes at a hefty price.

Optoro found that processing a return costs retailers an average of 30% of an item's original price. However, returns aren't just an issue for retailers' financials; they also impact customer satisfaction and brand reputation.

What happens to your returns

Retailers face challenges in enhancing sustainability due to the fact that returns often do not end up back on the shelf, as stated by Spencer Kieboom, founder and CEO of Pollen Returns.

Sometimes, products are sent backward through the supply chain to be repackaged, restocked, and resold overseas, which is referred to as reverse logistics.

"Playing a tape in reverse" is how Optoro's Ali described the reordered process.

The process of returning goods generates even more carbon emissions, with only 54% of all packaging being recycled, according to the U.S. Environmental Protection Agency.

According to Optoro, last year's returns generated 8.4 billion pounds of landfill waste.

by Jessica Dickler

Investing