Free and easy returns have become a standard part of online shopping. So much so that nearly two-thirds of U.S. e-commerce consumers reported deliberately over-purchasing planning to return unwanted items later! On average, 20% of all online purchases are returned compared to just 9% in physical stores. While returns are an issue across all shopping categories, studies have found that clothing accounts for the highest return rate (25%), followed by bags, accessories and shoes (18%).
However, many don’t realize the massive environmental impact these have. On average, returns increase the carbon footprint of a purchase by 30%, adding unnecessary greenhouse gas emissions to the supply chain.
Key takeaways
- Shopping returns increase a purchase’s carbon footprint by 30%, with clothing returns alone generating emissions equivalent to 3 million cars. Many returned items end up in landfills, contributing to waste and pollution.
- Returns lead to more transportation, fuel use, and carbon emissions. Additionally, most returns rely on single-use plastic packaging, which is difficult to recycle, further amplifying the environmental impact.
- Strategies like resale markets (e.g., Patagonia’s Worn Wear), faster return processing, and new technologies like augmented reality and AI can help lower return rates and minimize waste.
- Consumers can be more mindful of purchases, and retailers can improve product descriptions, images, and sizing information to reduce mismatches. Shortening return windows and expediting restocking can also prevent items from becoming unsellable.
Why are returns bad for the environment?
We know that returns have a monetary cost, as many retailers are seeing return rates grow faster than their revenue. But what about the environmental cost?
When people return products, it creates a complex system called the “reverse supply chain.” This process involves shipping the item back, checking its condition, repackaging it, and sometimes fixing or reselling it. If the item cannot be resold, it often ends up in a landfill. The environmental impact is staggering: clothing returns alone release the same emissions as 3 million cars.
1. More transport
Returning items means more transportation, which leads to more fuel use and carbon emissions. If a courier picks up a return, it adds pollution. If a customer drives to return an item, it can be even worse, especially if it’s a separate trip.
2. Waste and landfills: what happens to returned items?
Many shoppers assume that returned items are simply restocked and resold. Yet, the ugly truth is that 25% of returns are unsuitable for resale and end up being liquidated, destroyed, or sent to a landfill. The remaining 75% isn’t simply restocked, it must pass a screening process: Is the item in good condition? Is that condition good enough to be restocked? Where should the brand restock it? These processes use energy and materials, increasing the environmental footprint.
To top it off, many retailers end up burning, shredding, and otherwise destroying returned items. Sometimes to preserve the brand’s value (as we are always taught) and other times simply because throwing away the goods is cheaper than resale or recycling!
3. Packaging waste
What about packaging? Unfortunately, it doesn’t get any better… most brands rely on single-use plastic materials, which are quite difficult – if not impossible – to recycle. According to the United States Environmental Protection Agency, only half of all generated packaging and containers get recycled. This means that each return further amplifies the environmental impact of fast fashion and online shopping.
How retailers can make returns more sustainable
While consumer awareness is growing, returns remain a major blind spot in sustainability efforts. The good news? Many retailers are now becoming more mindful of the impact of their growing returns and coming up with innovative ways to reduce them.
The key is transforming returns from an inconvenience into a strategic asset. The question is: how can retailers strike a balance between maintaining returns and protecting the environment? In other words: how can retailers make returns a more sustainable practice?
1. Embracing resale and second-hand markets
Patagonia leads the way with its Worn Wear marketplace, where it turns its returns into a profit center by not disposing of any of its returned products. It also actively buys used Patagonia apparel and resells it. The resale and second-hand market are only growing so the retailer has found a way to transform the inconvenience into an asset! Well done Patagonia!
2. Faster return processing and shorter return windows
Retailers can resell returned items more efficiently by speeding up processing times. Think about this, it takes shoppers about 30 days to return an item, and retailers need another 30 days to inspect and restock returns. This means items sit unsold for nearly two months!
Since the average apparel season usually lasts three to four months, inevitably many of those returned items will become outdated or unsellable. This not only causes negative economic consequences (retailers can lose 20% of the expected sale value of their inventory with slow processing times), but high environmental impact, as many of those items will end up in landfills just because they were not sold during the season.
Shortening return windows and expediting restocking could prevent seasonal apparel from going straight to landfills.
3. Leveraging new technologies
Augmented Reality (AR)
Imagine trying on a shirt virtually before buying it. That is exactly what AR is aiming for. AR technology allows shoppers to see how clothing will fit, reducing return rates. Gap has been a front-runner of this as it has acquired Drapr, a virtual fitting-room platform to enhance its online shopping experience.
Artificial Intelligence (AI)
AI brings another innovative solution to the table. As part of the process of returning products, brands generally ask customers to fill out a short questionnaire on why they’re doing so. AI can help retailers sort this information out and identify commonly returned items and fix issues (e.g., incorrect sizing or misleading descriptions). AI could also help give shoppers personalized recommendations, and help them pick the right materials, sizes, and fits.
4. Improving product descriptions and images
A major reason for returns is that products don’t match online descriptions. There’s nothing more frustrating than ordering something that looks perfect on screen, only for it to arrive and be… just not it.
This mismatch can easily be fixed by readjusting the way retailers present products online. High-quality pictures and videos, accurate measurements and sizing charts, featuring diverse models to show how items fit different body types, are just some examples.
Final thoughts: Not free nor easy!
E-commerce is here to stay, but it desperately needs to evolve to align with sustainability goals! So, since returns are a necessary evil, retailers and consumers alike need to make them more environmentally friendly.
Instead of treating free and easy returns as a given, retailers must focus on minimizing returns at the source. Meanwhile, shoppers should be more mindful of their purchases. By reducing return rates, retailers can increase profitability and consumers can avoid the hassle of returning products. Oh, and we almost forgot: the environment breathes a sigh of relief!
What do you think about returns? Should they be expected by shoppers? Should they be free and easy? Let us know in the comments below!
