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  • Writer's pictureZsofia NAGY

Holiday shopping: returns management and sustainability

holiday shopping returns management for sustainability

In this recent article, it looks like retailers started adopting the "keep it" policy with shoppers to reduce their returns & re-sell costs, especially during the holiday shopping season.

According to Reuters, around 59% of online retailers have adopted the keep-it policy.

While this move is completely understandable from a cost management point of view as returns management, or in supply chain terms, reverse distribution costs (total, not only logistics) are high, it is unfortunately detrimental from sustainability point of view.

This policy is fostering the wrong consumer behaviour:

They order anything & everything, even if they don't need the product (impulse buy), as the burden and cost associated with what happens before/after aren't reflected in the prices (or so little that there is zero impact on the consumer).

Some of them actually commit fraud as they get the return & then resell it themselves.

Why is this fostering a wasteful (unsustainable) behaviour on both sides?

  1. the product was produced and won't be used, so the resource footprint that went into production & distribution serves zero purpose/value for anyone

  2. the business that sold it, will be negative on budget (unless they run obscene margins on all products), as their associated selling costs are there, but they refund the price to the customers (they even have associated cost with monitoring fraudulent customer behaviours as well)

  3. the product will end up very likely in a landfill or in an incinerator, which pollutes and uses resources even further

  4. the customer will never be able to attach value to the item & services bought as they get the services associated for "free" while they get a full refund on the product - they simply don't register the effort behind, so they won't care

  5. the business merely externalised the responsibility of how a product will be handled after it was bought & fully refunded, so the actual ownership of the product is still with them, while it isn't - so it is a loophole of both ownership of product and ownership of responsibilities

What would be a sustainable solution from a business point of view?

  1. charging customers return fees (full fees, not only logistics, but full value chain fees for reverse distribution)

  2. actually taking care of the returns as a business, especially if an item was sent incorrectly by the business to customer

  3. changing business models and shortening value chains, which could result in more agile and responsive supply chains when it comes to demand fluctuations

  4. freight companies should charge no less than total cost - that should be an industry legislation that they cannot charge under total cost

  5. EPR legislation should be strengthened on returns management and companies should not be allowed to use this ownership loophole

What can you do as a customer?

  1. please think twice before buying anything this holiday season (and well beyond): do you really need it, will it be regularly used and loved?

  2. please always return items, if they aren't what you wanted, even if it costs you the postage

  3. please buy only from companies which are willing to care about sustainable return policies and buy locally as much as possible (from small companies too)

  4. please try to buy experiences or adventures that you can do together with the loved one you are buying it for (I'm sure a theatre ticket, or winter walk with a dinner can be a winner)

  5. consider pre-planning for holiday seasons and if you really need to buy a product, then buy it well before (it is also fun to hide it and keeping it a secret!)

Thank you and I wish everyone a peaceful and happy holiday season!

Relevant article can be found here:

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