by Kwegyirba Croffie, CNN
As Americans bring back unwanted holiday gifts, those returns will cost retailers upwards of 50% more than they did last year. Retailers are already dealing with elevated costs thanks to the supply chain crunch and a tight labor market.
Now, returns processor Optoro estimates that returns this year will cost retailers $33 of the price of a $50 item to process — up 59% from 2020.
Costs are rising due to those supply chain issues, like higher transportation costs, as well as discounting and liquidation losses.
Returns are the norm after the holidays — especially following this year’s surge in online shopping. In fact, Optoro says two out of three shoppers will likely return at least one gift during the 2021 holiday season. In all, Optoro predicts that $120B billion in goods will be returned between Thanksgiving and end of January 2022.
But despite supply chain issues and inflation, it didn’t stop Americans from shopping this year. U.S. retail sales rose 8.5% year-over-year between Nov. 1 and Dec. 24, according to a new report from Mastercard. An uptick in clothing sales helped drive the spending surge.
Overall, this holiday season is on track to set new records. National Retail Federation President and CEO Matthew Shay said that holiday sales this year could grow as much as 11.5% from last year. U.S. retailers took in $789 billion during the 2020 holiday season.
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