Retailers Are Charging Return Fees This Holiday Shopping Season

If you’re thinking about returning anything bought or gifted during the holiday shopping season this year, brace yourself for potential fees. Industry-wide data reveals that nearly 40% of retailers are imposing return fees. This information, coming by way of retail technology company Narvar, signals a steep rise from last year’s 31% as businesses strategize to safeguard their profit margins amidst declining consumer demand and escalating expenses.

Over the past couple of years, retail powerhouses such as fashion giants Zara and H&M have set the trend by introducing policy adjustments that impose a fee on returned items shipped back. It’s becoming more evident that a growing number of retailers are starting to experiment with these charges as a result of the ongoing harsh economic situation.

Returns are not as straightforward or cost-effective for retailers as consumers might think. For instance, logistics technology company Optoro estimates that processing a return could cost retailers “as much as 39% of the original price.” This expense is so exorbitant that e-commerce juggernauts like Amazon and Walmart sometimes allow customers to keep their refunded item rather than return it to save on costs.

Consumers might be annoyed by these new practices, but there are some upsides. Jessica Ramírez, a retail research analyst at Jane Hali and Associates, emphasizes that discontinuing free returns could help corporations achieve their environmental objectives. Optoro’s data reveals that returned inventory in the U.S. last year contributed significantly to environmental degradation, producing 9.5 billion pounds of landfill waste and 24 million metric tons of CO2 emissions.

Retailers currently charging for returns include:

• Abercrombie & Fitch: $7 mail-in refund deduction.
• Amazon: $1 fee on certain returns made at UPS stores, and UPS pickup between $6.99 and $7.99.
• American Eagle Outfitters: $5 deducted from certain mail-in returns.
• Dillard’s: $9.95 for mail-in returns.
• DSW: $8.50 for non-Gold/Elite members.
• H&M: $5.99 deduction for non-loyalty members.
• JCPenney: $8 for mail-in returns.
• J.Crew: $7.50 deduction for mail-in returns.
• Kohl’s: Customers pay return shipping; 15% restocking fee for larger items.
• REI Co-op: $5.99 refund deduction.
• T.J.Maxx: $11.99 deducted for return shipping and handling.
• Urban Outfitters: $5 restocking fee on most mail returns.
• Zara: $3.95 deducted from mail-in return refunds.