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41% of returns resold through discount channels, data shows

DeliveryX

The majority of products sent back by Black Friday shoppers will end up being resold through discount outlets, recycled or given to charity, according to data from retail logistics firm Advanced Supply Chain.

Research by the logistics company, found that just one-in-10 retailers manage to resell 76% of returned goods via the original point of sale.

Where products aren’t resold through the same channel:

  • 41% of returns are resold through discount sales channels, such as outlets
  • 16% of returns are recycled
  • 13% of returns are donated to charities
  • 12% of returns are sold to other businesses, such as auction houses
  • 12% of returns are disposed of

“Disposal of returns doesn’t support retailers’ sustainability goals and is often the very last resort. Discount sales channels prove a popular destination for returned products, because consumers like a bargain and it’s a quick option for retailers to shift imperfect, returned stock at the best-possible price,” said Ben Balfour, COO of Advanced Supply Chain.

“The real win-win for shoppers and retailers is for returned items to be resold as Grade A stock, where a product is quickly restored to perfect condition and made available through its original sales channel. This helps avoid margin dilution caused by returns and puts less cost pressures on retailers, which otherwise risks shoppers being charged to return unwanted goods. Connected, data-rich supply chains are crucial for improving Grade A salvaging of returns.”


Read more: Peak performance – Top tips for preparing supply chains


Research from the company also suggests ‘false returns’ will be an issue for retailers this Black Friday. It found 63% of retailers have seen a rise in disingenuous returns during the cost-of-living crisis.

“Wardrobing is an issue for retailers and especially around the festive season. However, we’re more likely to see a spike in false returns because Black Friday deals can encourage impulse purchasing and trading down,” added Balfour.

“People buy brands they are less familiar with, and less impressed by, as well as products they can’t really afford. They send items back when the financial reality sets in and aren’t always genuine about their reasons for returning products.”

Read more about the challenges of returns for retailers in the DeliveryX Returns 2023 report. Download it in full to discover:

  • How some retailers are deploying loyalty schemes to deal with the returns problem
  • Why Zara set the precedent by charging for returns
  • What are “Bracketing” and “Wardrobing”?
  • The main reasons for the post-Christmas and January sales ‘returns tsunami’

Read More

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