According to a study from the National Retail Federation, this could cost retailers as much as USD 2.2 billion, USD 300 million more than 2014. The NRF predicts total annual returns to reach USD 260.5 billion, which is 8% of the total retail sales.
The biggest issue retailers face with fraudulent returns is the return of stolen products. 91.9% of retailers said they have experienced such a problem thus far. 72.6% of retailers have experienced wardrobing fraud, where consumers will return used merchandise that is not defective. Both of these figures are in line with those from 2014.
The increase in online holiday sales this year may also pose a problem for retailers. One-third of retailers reported that they experienced return fraud through the use of e-receipts, a huge increase from 18.2% of retailers a year ago.
Many consumers who ordered products online will choose to return those products at their local stores, which could lead to inventory surpluses at some locations. Retailers must adjust their inventory management systems to accommodate for the boost in returns for products originally purchased over the internet.
Every day we send out a free e-mail with the most important headlines of the last 24 hours.
Subscribe now