te study conducted by the NRF also found that for the 2024 winter holiday season, retailers can expect their return rate to be 17 per cent higher, on average, than their annual return rate. As a result, many retailers have begun taking extra measures to address the heightened return volume. Two-thirds of retailers surveyed indicated that they have started charging for at least one of the return methods they offer this year.  Additionally, 40 per cent of retailers surveyed reported that they were seeking out additional support from third-party retailers and 34 per cent commented that they will be hiring additional seasonal staff to specifically handle returns. However, it will take more than a measure or two to address this rapidly growing return issue.  As David Sobie, the co-founder and CEO of Happy Returns, remarked, “Return policies are no longer just a post-purchase consideration, they’re shaping how younger generations shop from the start.” “With behaviors like bracketing and rising return rates putting strain on traditional systems, retailers need to rethink reverse logistics,” Sobie warned.  What’s going on with customer refunds  Neil Saunders, managing director and retail analyst at GlobalData, told Inside Retail that the rising value of returns is partially down to the fact consumers are shopping online more.  As online shopping and other digitally-centered avenues of shopping, such as TikTok Shop, have made purchasing with the literal click of a button progressively easier, it has also raised consumers’ expectations for an equally easy return process.  The GlobalData executive also pointed out that “the proportion of purchases returned has also increased, which is a function of a consumer that has become pickier and more concerned with their finances. More economically constrained consumers are less likely to hold onto products they are uncertain about.” Unfortunately, offering various, low-effort return options has become increasingly difficult thanks to rising supply chain and labor costs. But it is still a necessary evil in today’s increasingly competitive retail environment. Three quarters of shoppers surveyed in NRF’s report stated that free returns are an important consideration for e-commerce transactions.  Furthermore, 76 per cent of consumers surveyed consider free returns a key factor in deciding where to shop, and 67 per cent say a negative return experience would discourage them from shopping with a retailer again.  What can retailers do to reduce returns-related losses  One effective measure retailers could take to help deal with the rising rate of returns, the Happy Returns founder suggested, is to offer customers no box/no label-style returns with item verification to help enable an immediate refund.  In fact, 84 per cent of consumers surveyed by the NRF reported they are more likely to shop with a retailer that offers this option.  Some retailers have also started to or doubled down on incentivizing in-person returns, which has become a popular option among customers.  66 per cent of shoppers interviewed said they would be more likely to return an item purchased online at an in-person location if they received an immediate refund when dropping it off.  Similarly, 65 per cent of consumers noted that they would be more likely to return items in person if they could do so without a shipping box or label.  Although this is still a tricky route for retailers to take, considering that consumers’ interest in in-person returns drops quickly when factoring in longer travel times.  62 per cent of consumers said they would travel up to five to return an item without a box or label, with the figure dropping to 26 per cent when asked about a returns location 5.1 to 10 miles away from their home.  Even further, Saunders distinguished two major reasons for consumer returns that need to be handled with different measures.  “Within returns, there is a big distinction between items returned because they don’t deliver what the consumer wants and those that are returned because consumers simply don’t like them or have changed their minds,” he explained. With the former reason for returns, retailers can partially resolve this issue by having more consistent sizing, utilizing better photographs, adding more product information and showcasing insightful review summaries.  Unfortunately with the later returns, Saunders cautioned, there is little that can be done aside from charging for a return or making returns more difficult to process, which can potentially turn customers from shopping with a retailer again. “In many ways, returns are part and parcel of doing business online. Retailers need to minimize the impact, but they also need to build the associated costs into their business models,” Saunders concluded.