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Costs of Returns

blog on the costs of returns

Though inevitable for retailers, the rate of returns for online purchases has escalated over the last several years. For some of us, seeking out return policies has just become a part of the way some of we shop.

To give you an idea, specifically in our area of higher priced fashion, clothing and accessories, returns can run from 20% all the way up to 50% especially around the holiday season.

return rates in ecommerce vs brick and mortar

Data via eMarketer (2018), Star Business Journal (2017), and Forrester via The WSJ (2015)

This means that at minimum, 20% of orders purchased online will go back to the company at some point. That’s a lot of product moving back and forth all year round. This increased return rate has developed a series of terms for those considered habitual returners. Habitual returners are customers where a company would more likely anticipate a return from them than an item to be kept. A couple of categories have been developed for these returners:

Serial Returner: Those who find joy in online shopping and receiving items but then almost immediately experience buyers regret causing them to return everything

The Wardrober: Someone who makes a purchase, wears it once, (say for an event) and returns it. This is especially common with retailers who try to provide lenient return policies. 

The Fitting Roomer: That customer who purchase a bunch of things in different styles and colours to find their favourite item, then return the rest. Like what one would do in the store changing room but via online shopping.


Customer return intentions

Data from Narvar (2018) and Return Magic Survey (2017)

With this kind of behaviour and the general increase in returns, Forbes has called it a ticking time bomb for businesses. Not only are returns an expensive process but it also creates a world of waste. 

Style democracy posted a great article this year regarding returns that has inspired us to hopefully shed some light on it. We’ll definitely be touching on some points here but there will be a link to the full article below. 

The points we want to highlight is environmental waste that gets produced by returns not only from transportation but also due to the fact that most retailers can’t afford or justify the cost of tackling all the returns that come back. 


world wide shipping

Shipping on the whole is a not very environmentally friendly process. All the transportation of packages does not help our carbon footprint. Not only are vehicles making daily delivery trips, but to keep up with the ever demand of faster shipping, there’s also dedicated planes flying as we speak to get shipments from one place to another. It could be international or even just from another province, but planes are what make your next day delivery possible.

To make it all worse, the options available for packaging do not help. Most ecommerce retailers uses those plastic shipping bags, many of which can’t be recycled. Heel boy has invested in using bags that can be recycled at your local grocery store but it's not the easy trip to your blue bin.

The options that provide more environmentally friendly packaging are usually too costly for small business, or don’t support the needs we’re looking for. For example, cardboard boxes. Cardboard can be recycled right! Well, when left at the front door in Canadian winters, they soak in the snow, potentially damaging the product inside. So while it may be recyclable, if it can't protect our product, it can't be used. 

We continue to work on our environmental footprint as we grow but are still faced with some limitations of the industry and nature of ecommerce business.


heel boy shoes

Now one factor we believe many aren’t aware of is the waste from the returned items themselves. There are warehouses across North America that are filled with returns just sitting there waiting to be disposed of.

Products that come back with minor defects like those pants where the tag popped off while trying it on, or the shirt that got deodorant stains, or that shoe box which was taped up, tend to go in a giant pile never to be touched again. Pants can’t be sold without a tag, customers don’t want a shirt already marked, and people aren’t expecting shoe boxes to be covered in tape or to receive shoes without a box at all. Customers don’t want items that look like they’ve been worn. Which, you know... fair, but then what are businesses like us supposed to do with items that are brought back? 

 “Why not just resell the returns? Just put on a new tag. Clean the shirt. Get a new shoe box”… Unfortunately there's more to it than that. Preparing returns for resale can sometimes cost more than the item was originally worth. With 20% of items purchased online being returned, most companies would likely need to hire a dedicated staff member or a whole department just to deal with all amount coming back. Now, returns may not be necessarily difficult to process but they are time consuming. 


damaged boxes


Each item needs to be precisely looked over for any flaws. If flaws are found then they need to be addressed. To reference the on-going example, let’s say the shoes are fine but the shoe box has been completely tape up when it was shipped back to us. The barcode has been covered, the tape looks so messy and if tried to be removed, it tears the covering off the box. It's deemed done for (we don’t want anyone to receive a damaged box) and we need to get a new one. The tricky part is we need to reach out to our brand suppliers to see if they just so happen to have an extra shoe box in the exact same style, size and colour. If they do, we may have to pay for the replacement box and/or pay to have it shipped it to us. Once it’s arrived we can repackage the shoes and put them out for resale in one of our stores or online. By the time we run through this whole process, it could be upwards of a week later.

If there’s nothing wrong, great! It’s gets to move along right? Well kind of. A lot of items will still need to be steamed/buffed/repackaged and then transferred to the correct location or added to inventory.

Often times, items don't get returned to the right place. An item can be purchased online and returned in-store right? Well, quite frequently, whatever was purchased online doesn’t exist as a product to be sold in-store. So it either needs to be added to inventory or sent back to the warehouse.

Each way, there's significant time spent on each individual item, and the hours that need to go into each one sometimes isn’t worth it for a company to invest in, leading to many products going out of season and just being thrown out.


shoe cobbler

Finally there’s the stuff that can’t be saved. To bring up an example, we had a pair of winter boots that were returned to us because a laces rivet had popped off after 6 months of use. While we understand this is considered a defective product for our paying customers, the rest of the boot technically still functions perfectly. In these cases, heel boy donate these boots to a local charities or shelter but that’s not always how companies treat defective products. Many products deemed defective are destroyed, even over the smallest of things. This is a fundamental company-to-company issue but we do encourage our shoppers to look for more economical ways to handles damages or defects. For example, requesting repair vs a return or replacement. This way you keep the shoes you loved, the defect is fixed by a professional and not added to the trash. 

We also know returns aren’t always the most convenient for you. We know products don’t always work out and it can be really disappointing. We want to help with that! Here are some ways to make sure you get what’s right for you! (Can be applied to other businesses but we’re keeping it shoe specific)

1. What’s in your closet?

Sometimes it’s great to look towards what you already own. What sizes do have in your  closet? What sizes worked out, which didn’t? Do you notice a difference in fit between you different types of shoes and brands? This can be a great start on your purchasing journey.

2. Look for a size chart

Most companies will offer a size chart for the products they host including sizing for various countries and sometimes even measurements for comparison. This is a great on-site starting place because it also might be the only place you need to look to find your answer.

3.What are you buying?

Now we will be the first to admit that sizing charts don’t always work for everyone, especially with shoe sizes. A size 8 might fit differently across different brands and even just shoe styles on their own, so keep in mind what you’re looking to purchase. Some may size down about a half size in tall stilettos for a more snug fit to prevent the heel popping out the back; boots can purchased close to a half size or even full size larger for some wiggle room with the toes or flexibility for socks. What brand are you buying? Some brands have unique fits or sizing so doing some research on them might provide some information.

4. Look for reviews. 

We always encourage reviews on products to get real feedback on our customers shoe experiences. While not everyone may have the same opinion, reviews can give you an idea of fit if you see a specific issue mentioned often.

5. Reach out to customer service.

If you’re still feeling really unsure about sizing, always feel free to reach out to customer service. They will have more knowledge or the very least, access to more knowledge on the products carried. With a bit of details, they could provide some purchasing guidance. 

6. Visit a store!

Now if you’re really unsure, feel free to drop by a store and try on the sizes in question. Our staff is happy to help guide you through the styles and answer questions you have about sizing. This way you get to actively feel the fit and have someone to answer any immediate questions you may have. Best part, we also providing shipping for in-store purchases. If you’re looking to do a full day of shopping around the city, instead of carrying around the bags, we can ship your purchase right to your door. 

We want your experience to be as seamless as possible, minimizing your worry for returns, and work on building a greener future for shopping. 

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