Returns are close to a trillion dollar problem now

Returns in e-commerce have become a significant problem for retailers, resulting in lost sales worth $816 billion in 2022 and causing about 24 million metric tons of carbon dioxide emissions.

Our view is - solve it at the source - predict demand better. If you eat 2 yogurts a week, but buy 5 - there will always be waste because your prediction is off...the same is happening in retail.

• Returning items involves transportation and packaging, with returns often ending up being thrown away.
• The return process includes transportation to dedicated warehouses, where items are unpacked, inspected, and repacked. If deemed resellable, the item is sent to another warehouse for potential resale. If the item is defective, it may be sent back to the manufacturer for refurbishing.
• However, some items end up in landfills if they cannot be resold or refurbished economically.
• The era of free returns may be changing, with more retailers starting to charge for return shipping.

Retailers are exploring various strategies to reduce return rates, waste, and losses, which can ultimately lead to higher prices for consumers.

Excellent article by Simone Peinkofer and #fortunemagazine: https://fortune.com/2023/06/14/amazon-returns-ecommerce-how-bad-big-problem-816-billion/