Retailers expect consumers to return more than $761 billion in merchandise sold last year for an average of 16.6% of total U.S. retail sales, which soared to $4.58 trillion in 2021.
According to a report from the National Retail Federation and Appriss Retail, the 2021 total rate of returns is up from 10.6% recorded during 2020, but online returns are in line with recent years at an average of 20.8%. NRF stated that online sales accounted for $1.05 trillion of total U.S. retail sales last year. Approximately $218 billion of online purchases were returned, with $23.2 billion, or 10.6%, deemed fraudulent.
NRF noted that, for every $1 billion in sales, the average retailer incurs $166 million in merchandise returns. In its study, the organization found that for every $100 in returned merchandise accepted, retailers lose $10.30 to return fraud. The categories with the highest return rates were similar to 2020 metrics: auto parts, at 9.4%; apparel, at 12.2%; and home improvement and housewares, each at 11.5% The most common types of payment used during the original purchase that led to a return were credit cards, at 22.8%; cash, at 12.7%; and debit cards, at 7%.
“As total retail sales continue to accelerate from sustained consumer demand during the pandemic, it is no surprise that the overall rate of returns has also been impacted,” said Mark Mathews, NRF’s vp of research development and industry analysis. “While retailers have indicated that they are seeing an increase in items returned to stores and online, the upside is that it also provides them with additional opportunities to connect further with customers and provide a positive experience.”
