Impact of Product Returns on Sustainability

The returns process is broken. It’s hurting our environment (and your brand). A lot of people understandably assume that if they return an item, that product will end up back on the shelf and eventually be resold (like magic 🙌). Unfortunately, that’s usually not the case. It takes a lot of time, money, and logistics to assess and repackage returned items — not to mention that many returned items come back stained or damaged — so most retailers end up trashing them instead. If you take into account the fact that shoppers returned nearly $280 billion worth of online merchandise in 2022, that is A LOT of waste that ends up in landfills. So what needs to change? I’m not suggesting that we get rid of returns, but brands need to give customers options. We need to ✨reimagine✨what the returns process looks like. A few thought starters: 1/ We need to stop thinking of the shopping experience as distinctly separate from the returns process. How you set up the shopping experience, especially online, impacts how often customers will engage with the returns process. So whether it’s incorporating sizing solutions like WAIR or adding clearer, more diverse product photos, we have to start thinking of ways to optimize the customer experience BEFORE they check out. 2/ We need to leverage technology. There are a growing number of returns management solutions like Two Boxes, Loop, ReturnLogic and Retail Reworks, that can more efficiently streamline returns and lower the cost (environmental + financial) of reverse logistics. 3/ We need to create a profitable, sustainable path for moving returned inventory. Reselling returned items at the point of return is one of the best ways to do this. It maximizes revenue for the brand while reducing the environmental strain. Brands are leveraging resale platforms like Treet to encourage customers to resell items instead of returning them, or reselling items after they’re returned. I know there are a lot of solutions and strategies I’m missing. Feel free to share below!

When You Return Those Pants, There’s a Price You Don’t See - a great read by The New York Times opinion writer Pamela Paul. ⏹ Fashion has a sustainability problem - and consumers have a return problem exacerbating the massive waste of clothing that doesn't get resold or recycled. Maxine Bédat's, Unraveled: The Life and Death of a Garment does an even deeper dive into the problems of clothing and waste - and her work New Standard Institute deserves more attantion. ➡ The problem: "We can click the return button first on the season’s passive-aggressive and otherwise unwanted gifts. An upgraded espresso machine, perhaps not so necessary. Farewell, too, to the aspirational dress purchased but never quite fit into without a squeeze. 🛑 By some estimates, returning purchases in America reached record levels in 2022; the portion of purchases returned has jumped twofold, to 16 percent from 8 percent of sales between 2019 and 2022 And returning things online has become so easy — just scan the downloaded QR code! — that people return items bought online at three times the rate they return things purchased in stores." Shocking, it shouldn't be: "Because returns are so expensive for online retailers, companies have focused on making the process as cheap and easy as possible — for themselves — and for the most part, the planet pays the price. Online returns create 16 million tons of carbon emissions or the equivalent of 3.5 million cars on the road for an entire year. It’s often cheaper for the seller to simply throw the item away than to inspect for damage, repackage and resell. Dumping returns (sometimes called “destroyed in field” or “damaging out”) is often less costly than reusing them. A number of startups have created middleman services to streamline the process or increase “circularity” by diverting returns to online resellers or charities, but the problem persists in grotesquely large quantities. 🔊 In the United States, 2.6 million tons of returned clothes wound up in landfills in 2020. And that’s just clothing." She gives the reader (who is also a consumer) a lot to think about - and act on. So, the next time you're pressing send on that piece of clothing you may or not keep, think twice! Michael Shank, Ph.D., you cover this in your NYU SPS Center for Global Affairs course on Sustainable Development and have had students look at the opportunities for circularity and more conscious consumption. We need more attention and action around the (lack of) sustainability in the fast and quick return options in our clothing choices. Michael Shank, Ph.D. Liubov Volkova Saskia Salak Sylvia Maier Shanli Najafy Jenny McPhee Amy McIntosh https://lnkd.in/gyuCUHwV

🎁 The Hidden Cost of “I Can Just Return It” 🎁 "I can just return it" – A harmless thought? Not quite. Every time we buy with the safety net of free returns, we might not think twice about what happens next. But here’s a reality check: - ~25% of returns are immediately thrown away, destined for landfills. - Only half of all returns make it back to the shelves. That “return it if it I don’t like it” (or worse, the “I’ll use it then return it when I’m done”) mindset has hidden consequences, not just for businesses but for the planet. Think about the additional packaging, transportation emissions, and waste generated—all from products that are often perfectly functional but don’t meet expectations. So what can we do differently? 💡 Pause before buying. Do I really need this? 💡 Check the details: size charts, reviews, and descriptions can help prevent unnecessary returns. 💡 Choose wisely: quality over quantity reduces the chances of needing to return at all. As consumers, we hold more power than we think. By being mindful of our purchasing habits, we can reduce waste, save resources, and contribute to a more sustainable future. 🌍 #Sustainability #Consumption #Circularity #CircularEconomy #Emissions

"In 2022, returns cost retailers about $816 billion in lost sales. That’s nearly as much as the U.S. spent on public schools and almost twice the cost of returns in 2020. The return process, with transportation and packaging, also generated about 24 million metric tons of planet-warming carbon dioxide emissions in 2022. "Returns are often free for the consumer. But managing those returns can get costly for retailers, so much so that many returned items are simply thrown out. "Returns start with miles of transportation to get items to retailers' warehouses dedicated to processing returns. This step of the process costs the retailer money – 66% of the cost of a $50 item by one estimate – and emits carbon dioxide as trucks and planes carry items hundreds of miles. The plastic, paper or cardboard from the return package becomes waste. Processing a return takes two to three times longer than initially shipping the item – it has to be unpacked, inspected, repacked and rerouted. That is a manual process, requiring hiring employees in a tight labor market. "Although in-store returns can significantly cut warehouse and transportation costs, only about a quarter of online purchases are returned in person to the store. "If the item is defective  the warehouse worker might flag it to be sent out for fixing and refurbishing. It would be repackaged and loaded on a truck and possibly a plane to get to the repair location, leading to more carbon dioxide emissions. "When it is more expensive to restock or refurbish a product, it may be cheaper for the retailer to dispose of the item. Some are sold in bulk to discount stores. Often, however,  returned products simply end up in landfills, sometimes overseas. In 2019, about 5 billion pounds of waste from returns were sent to landfills, according to an estimate by the return technology platform Optoro. By 2022, the estimated waste had nearly doubled to about 9.5 billion pounds. [2023 data not yet available, but the upward trend has probably continued.] "Era of free returns might not last. The percentage of retailers charging to ship returns increased from 33% to 41% in 2022. Retailers are also trying several other techniques to lower the return rate: shortened the return window, limited frequented returns or stopped offering free returns. Other strategies include virtual dressing rooms and clearer fitting guides, which can help reduce clothing returns, as can high-quality photos and videos that reflect size and color accurately. Above excerpts from June 2023 article by Simone Peinkofer,  Assistant Professor of Supply Chain Management, Michigan State University. https://lnkd.in/eakHVPHS