Last year’s November e-commerce peak was 25% higher year over year and wreaked havoc on supply chains, while simultaneously leading to retailers’ footing an even larger bill for returns. This year’s shipping mania is expected to lead to a further 10% increase and even if many retailers can now handle delivery to the house with decent margins, a corresponding increase in returns could throw their profits into disarray. The costs of returns are so prohibitive – at least 30% of items bought online are returned vs. just under 9% in-store- that even the largest retailers are quietly telling their customers to keep items rather than return them. While the holidays’ potential to cause a returns tsunami is worthy of extra attention,companies leveraging the long-term and accelerating shift to e-commerce and the ability to effectively deal with the extra returns it causes, separates successful retailers from soon-to-be bankrupt ones.
