At NRF 2024, goTRG participated in the "Rethinking Returns" panel discussion alongside Walmart, the National Retail Federation (NRF) / the Reverse Logistics Association (RLA). The panel featured insightful conversations on the evolving challenges in retail returns. Steve Rop, COO of goTRG, shared his expertise alongside industry leaders.
For the first time in history, the retail industry saw a decline in return rates in 2023 to 14.5% of all sales, a decrease from the previous year's all-time high of 16.5%. This change is attributed to strategic shifts across retail, including improved fraud detection, return policy adjustments, and working with returns management solution providers such as goTRG.
goTRG's COO, Steve Rop highlighted the implementation of better fraud detection systems, stiffer return policies, and fee imposition as crucial factors in reducing return rates. He also suggested that macroeconomic factors, like consumer caution due to recession fears, influenced shopping behavior. Mr. Rop emphasized the significance of overstock inventory, estimating it to be an additional $300 billion to $400 billion per year, bringing the market of unsellable and returned goods to over a trillion dollars.
The panel discussed various strategies retailers are employing, such as Walmart's efforts to make returns easier and more customer-friendly. The potential future role of AI in returns processing was also addressed with Mr. Rop noting that while AI is in use, human oversight remains necessary.
With return fraud causing substantial losses, retailers are focusing on differentiating between trusted buyers and those who negatively impact profits through return habits. Walmart shared insights into their data-driven strategy for managing returns, emphasizing the importance of a comprehensive view of the return process.
goTRG's involvement in these discussions showcases its commitment to addressing the complexities of reverse logistics and its role in shaping future retail strategies.