Will online customers soon have to pay for returns again?

We are all familiar with the quandary: should I order the T-shirt in medium or large? So, we often go for both, and each in three different colors – after all, you never know. The wider the choice, the better. You can always send them back, and it doesn’t cost anything, right?

There is no denying the fact that e-commerce has taken off in recent decades. And it is also a fact that vast quantities of items are sent back. According to a study by DynamicAction, returns in Europe increased by eight percent in the first half of 2019 alone. The motivations are manifold: inaccurate product descriptions, goods that failed to meet expectations or did not fit, or multiple items were ordered from the outset, etc. In the latter case, especially, consumers show few inhibitions. And the key driver of such multiple-choice orders is the ability, in the majority of instances, to return them free of charge.

However, there is no legal reason for this: according to Article 14 of the EU Directive on Consumer Rights, for example, the purchaser is responsible for the costs of return shipment where they have cancelled their order. However, major e-commerce players prefer to provide free returns as a service in order to bolster customer loyalty and satisfaction.

So the goods have been returned – and now?

This all has an enormous impact in terms of work effort and operational costs. And as the expense for “reverse processing” of goods for mail-order giants such as Amazon is often greater than for their disposal, many returned items simply land directly in the garbage. As a result, Germany for one is to introduce legislation to enforce less waste.

Returns cost e-commerce companies time and money. But solutions are available that could ease the pain, such as the merchandise returns system* from automation specialist Dematic. This is a material flow sub-system that accelerates all tasks – from providing customer credit, to entering the exchanged order, to making returned items available for re-sale. Dematic iQ software supports the analysis and streamlining of workflows before items are again put away as “sale ready”.  

Charge a fee to protect the environment?

Even if returns are processed efficiently, is it time to insist that consumers pay a price? Industry researchers believe the solution is a fee for returns mandated by law, not least in order to protect the environment. The many items that are shipped back to the sender cause significant emissions. And they generate mountains of waste packaging. However, there are some who warn against government intervention in the competitive marketplace. At the same time, it would seem certain that the introduction of a fee for returns would bring about a marked reduction in their number. But many online vendors are fearful of losing customers if they go it alone. So, currently, it is unlikely that charges will be rolled out any time soon.

*German only

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