goTRG Report: 2023 Returns Insights and 2024 Forecast provides a comprehensive analysis of retail returns in 2023 as well as a projected forecast for 2024.
In 2023, US retail sales hit $5.1 trillion with returns reaching $743 billion, including 14.5% returns rate. This cost of returns poses significant challenges for retailers who now view returns as a severe problem jumping from the previous year's 16.6% to 49.2%. The rise in eCommerce, doubling sales to $1.5 trillion, has escalated return rates, particularly online, where 15-20% of purchases are returned.
Returns exacerbate waste, emissions, and economic losses, often resulting in goods being sold at reduced prices or disposed of. To combat this, over 75% of retailers are investing in reverse logistics and returns management SaaS technology with many allocating $1-5 million to enhance their return processes and partnerships, aiming to improve recovery rates and customer satisfaction.
Innovative approaches, such as testing out different returns policies, encouraging BORIS (buy-online-return-in-store) and forming partnerships with returns management and reverse logistics service providers are being implemented to enhance customer experience, increase operational efficiency, mitigate fraud and improve the post purchase journey.
An optimistic outlook for the future centers around the notable decline in retail returns, from $816 billion in 2022 to $743 billion in 2023, despite a 4-6% growth in sales. This indicates the effectiveness of retailers' investments in innovative return strategies, partnerships and technology. Retailers are adopting dynamic software solutions offering options like "keep it," instant exchanges, and more, enhancing customer convenience and potentially improving retention by up to 30%. Furthermore, advanced returns services are also addressing the issue of fraudulent returns, contributing to a more efficient and customer-friendly returns process. goTRG is leading this transformation, offering expert solutions in solving returns.
