Zara is now charging UK shoppers to return online orders via third-party delivery points in a move that looks likely to kickstart a debate about who bears the cost of returns as ecommerce expands quickly.
Since May 3, the fashion retailer has charged £1.95 to shoppers who return unwanted goods to a third-party drop off point. It says on its website that shoppers can return clothes from several orders in one return box, with an separate QR code generated for each box. Zara stipulates on its website that returns must be made within 30 days of the order being shipped. Clothing must still have labels attached and be in perfect condition.
However, there is no charge when shoppers return goods to stores. A spokesperson for Zara says: “Customers can return online purchases at any Zara store in the UK free of charge, which is what most customers choose to do. The £1.95 fee only applies to the return of products at third party drop-off points.”
The move comes at a time when return rates are rising in step with the shift online, raising the potential costs of ecommerce. In March, Boohoo said that it had seen a spike in returns as customers returned more unwanted online orders over the three months to the end of February.
Rob Shaw, SVP global sales at Fluent Commerce, says: “With product return rates in ecommerce ranging between 20% to 30% and global ecommerce sales projected to hit £4.7 trillion by 2023, the volume of returns is only set to increase. As a result, the way retailers and brands manage returns is becoming a more important part of the customer journey.
“Most retailers will be familiar with the challenges created by customers who both buy and return lots of products. Identifying these buy/return patterns is becoming an important step in effectively predicting the potential level of returns, which in turn, can help prevent excess stock replenishment. However, some retailers have different returns policies or processes for high value customers or those that tend to buy items at full price. This is an important consideration, as taking care of customers in these categories in the long term makes more business sense, so maintaining their loyalty is key. This is often true even if they have high return rates, and retailers should avoid penalising or even blacklisting loyal and active customers if at all possible.
“A study carried out in 2019 by UPS revealed that 54% of consumers look at the returns policy before making a purchase. This only serves to underline the importance of returns in the wider sales process, and its terms and levels of convenience will have an influence on the bottom line if customers don’t like what they see.” Shaw adds: “The key point for retailers is the way they deal with a disappointing or unwanted purchase is just as important as how well they attract customers in the first place.”
Zara is a Top150 retailer in RXUK Top500 research.