British online fashion retailer boohoo is planning to charge its UK customers a fee for returning merchandise, Bloomberg has reported.
The development comes after the company’s latest trading update showed its revenues declined by 8% in the three months to May amid a rebound in ‘normal’ shopping habits.
boohoo is currently reviewing its returns policy across all markets. It already charges customers for returns in some international markets and is currently considering introducing the same policy in the UK and elsewhere.
Founded in 2006, the company sells menswear, womenswear, shoes and other accessories.
Bloomberg quoted boohoo CFO Neil Catto as saying: “In the UK, the returns rate is a big factor and in international it’s taking us a lot longer to get parcels to customers.
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“Those factors still continue and we’re not expecting those to improve this year.”
The review comes after Inditex, the owner of clothing retailer Zara, recently began charging fees for online returns in an effort to drive traffic to its brick-and-mortar stores.
Bloomberg noted that boohoo has many younger customers, who tend to buy several low-priced items before deciding which items to keep and which to return.
For the three months to 31 May, boohoo’s revenue amounted to £445.7m ($545.7m). In the UK, its quarterly revenue fell by 1%.
Boohoo CEO John Lyttle said: “We have seen promising signs from the Group’s sales performance in the UK, which has improved month-on-month in the period and we are looking ahead towards our key summer trading season as holidays ramp up and customers look to the latest fashion from across our brands.
“Looking forward, we will continue to focus on optimising both our financial and operational performance to ensure the business is well placed to take advantage of future growth opportunities.”
