Recouping the Cost of Returns

Discuss how retailers are recouping costs with ZigZag
Recouping the Cost of Returns

H&M became the latest retailer to move to paid returns in September. A headline that really confirms the reality that paid returns are becoming the new normal.

As one of the most recognisable fast fashion retailers in the world, H&M’s decision to start charging for returns will send further shockwaves through the retail industry. It gives confidence to retailers of all shapes and sizes to start recouping the costs of returns.

The fashion retailer is not without paid returns companions. Next, Uniqlo, Zara, and boohoo all switched to paid returns early this year or in 2022. The introduction of the £1.99 fee is a consequence of challenging economic conditions and returns-happy customers. The fee will barely scratch the surface of the true cost of handling returns, but it will certainly help.

A returns fee also has the added benefit of acting as a slight deterrent for returns abuse, whereby customers bulk order items with the intention of returning at least one item from their order. ZigZag’s latest data suggests 46% of customers currently participate in this practice.

Royal Mail’s Eirian Jane Prosser got in touch with ZigZag Co-Founder & CEO Al Gerrie to find out more about why retailers are charging for returns and his predictions on where the industry is heading.

Al commented, “There's no such thing as a free return, there's always someone who has to pay for it and given the current levels of inflation, supply chain issues, increased labour shortages and fuel surcharges, it is understandable that retailers would need to find a way to recoup some of the cost. Especially as, post-pandemic, the number of online returns has increased significantly, as such, so has the cost to retailers.”

The Daily Mail is one of the highest paid circulation newspapers in the UK, so naturally, ZigZag welcomed the opportunity to provide some insight into the paid returns debate. You can read more from Al and other logistics experts via the article below.