Online shopping for the holidays hit an all-time high this year, and you know what that means: lots of mailed returns. UPS expects a whopping 1.9 million packages will be returned in the U.S. on January 2nd — a day appropriately dubbed “National Returns Day.” That’s 26 percent more than last year.
This is very bad for retailers — Sure, retailers made enormous profits from online sales this holiday season, but they’re about to feel the frustration of all those unwanted gifts. According to Business Insider, items returned through the mail cost about twice as much as those returned to stores. A returned product costs retailers about $3 in stores, while returning the same item in the mail costs up to $6 per item.
But this is pretty much par for the course — Last year, returns cost retailers an estimated $369 billion in lost sales, which was about 10 percent of the season’s profits. This year retailers expect this to rise only slightly to 11 percent.
It’s Amazon’s world and we’re just living in it — Because mega-sites like Amazon offer free returns with minimal questions asked, smaller retailers are being forced to follow suit. No one wants to make the trip to the brick-and-mortar store to return their gifts — and, as usual, it’s the little guy that loses out in the situation.