Published
Oct 21, 2016
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Serial returners are growing problem for fashion retailers, says new UK survey

Published
Oct 21, 2016

Retailers are losing out financially due to consumers taking them up on generous returns policies. As many as 26% of refunded items returned because the customer changed his or her mind is unfit for resale, according to new UK research from Barclaycard.

Many stores have adjusted online returns strategies to address 'serial returners'


The credit and debit card provider spoke to 4,000 consumers and 300 retailers and said reasons for returned items being unsaleable include the fact that they have been used (48%), are marked (29%) or have parts missing (28%).

As a result, retailers are struggling to strike a balance between encouraging purchase and keeping customers happy via liberal returns policies, or damaging their margins. Currently, 57% of merchants grant refunds regardless of product condition to maintain a positive relationship with customers.

The problem has become so big for some that 22% have had to introduce new systems to deal with the unsaleable returns, the survey showed. As many as 11% have partnered with a reseller to sell items on at a loss, but such is the volume of stock that 8% have moved to a bigger warehouse to store unwanted goods.

On the other hand, some retailers have opted to restrict their policies in a bid to cut the level of returns, particularly for online purchases. Driven by the buy-and-return habits of so-called ‘serial returners’, 37% of merchants admit that they do not offer free returns, hoping this will discourage shoppers from returning non-faulty items. A further 12% have stopped offering free returns because they became too expensive.

But despite the growth of serial returners, 39% of shoppers end up keeping some unwanted items because returning them is too complicated.

Barclaycard said these shoppers are helping to minimise retailer costs as almost one in six shoppers (17%) have, in the last 12 months, paid for and kept items they have never used.
 
Out of the items consumers intended to return, but never got round to it, clothing topped the list (55%), followed by shoes (30%) and kitchen gadgets (17%). One in five (22%) of these ‘stashers’ kept the item because there was a cost attached to returning it, whilst 39% felt it was too much hassle to return it. Another 44% missed the window to return as defined by the retailer.

However, while that could be interpreted as a win for the retailer, if it discourages the shopper from buying from that store in the future, it could be just the opposite.
 
Barclaycard said retailers’ decisions to restrict returns policies could ultimately be having a negative impact on their business. As many as 36% of consumers claim they would be put off shopping somewhere if there was a charge to return items by post or courier. That makes this issue more important to shoppers than quick delivery with only 15% discouraged by a delivery taking more than three days.

Consumers are also looking to retailers to provide multiple options for how to return items (49%), refunds instead of credit notes (46%) and a long window for returns (40%).
 
Barcalycard’s customer solutions director Sharon Manikon said: “Our research demonstrates that offering a good returns policy can help retailers attract and retain customers.”

 

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