Aggregated return rates suggest that 20% of items bought online are returned to retailers.

According to parcel delivery management software provider nShift, these returns cost retailers $642bn a year.

This forms a sizeable chunk of the global e-commerce market size, valued at $6.5tn in 2023 and expected to grow at a compound annual growth rate (CAGR) of 9.1% by 2026.

nShift references research, which estimates that this costs UK e-commerce companies £20bn a year and that shoppers in Northern and Western Europe are the most likely in the world to send items back.

To combat this, retailers such as JCPenney have started charging $8 for returns by mail while Amazon has marked products with high return rates on their site.

nShift advises that retailers should secure more data about returned purchases to help identify why shoppers are keen to part with their purchases and reduce returns volumes.

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By GlobalData

nShift product director of returns Philipp Goldberg comments: “When shoppers send an item back, retailers need to investigate the problem. If a common fault keeps cropping up on one product, they can investigate problems across the supply chain.

“To obtain this kind of information, businesses need to operate a digital returns process that quickly captures the data. Patterns become clear quickly and retailers can create automised processes, getting items back up for sale quickly.”