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US merchants faced USD 260 bln losses in retail returns in 2015 – National Retail Federation

Tuesday 20 December 2016 | 08:27 AM CET

The National Retail Federation has found that US consumers returned USD 260 billion in merchandise to retailers in 2015, which means 8% of all purchases.

Return rates could reach 30% or more for merchandise that's bought online, and clothing returns can be closer to 40%, reports.

Return rates lead also to 10% around the holiday season. Because less than half of returned goods are re-sold at full price, retailers may end up forfeiting 10% of their sales at the busiest time of year, according to Gartner Research.

Unwanted and damaged goods either get tossed out or sent through a lengthy chain of liquidators and wholesalers, paying pennies on the dollar to the retailer before eventually selling them to bargain-hunting consumers.

Third parties are trying to disrupt the traditional model for dealing with this issue. For instance, Optoro claims its technology platform optimises the efficiency for returned merchandise by finding the best re-sale price the moment the product is returned and scanned.

Sixteen of the top 20 US retailers and manufacturers use Optoro's technology. Its client list includes Home Depot, Target, BJ's Wholesale and (owned by Walmart).

After being returned to a store, merchandise ends up at Optoro's warehouse in Mount Juliet, Tennessee. Once the merchandise arrives at the warehouse, it gets tested and inspected first. When it's determined to be in working order, or refurbished and given a clean bill of health, it's simultaneously listed for re-sale on Amazon, eBay, and Optoro's retail site, called

If an item isn't able to be refurbished easily, it goes onto a pallet of goods sold on Optoro's website. buyers often don't mind doing the repairs themselves because they get a deeper discount.

Electronics make up the bulk of returned products to Optoro, at just under one-third. Home and garden merchandise makes up 20%, while baby items, clothing and other consumer electronics are another fifth of the returned products in Optoro's warehouse.

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