Returns management platform Loop has introduced new services for merchants and logistics providers.
“A series of new features, integrations, and partnerships will enable logistics partners to share enriched data between Loop and merchant warehouses and allow brands to ship and move their returns more efficiently,” the company said in a Monday (Feb. 5) news release.
This, Loop added, will allow for faster return processing, lower shipping costs, better insight and control over return policy abusers, fewer unnecessary returns, and improved sustainability.
“Given today’s economic climate, brands and partners must optimize reverse logistics with the same urgency that they optimize forward logistics,” Loop CEO Jonathan Poma said in the release.
“The product improvements and partnerships we have made in reverse logistics are key to our merchants’ long-term success and growth. With these improvements, we are further building on our commitment to bring intelligence, cost savings, a reduction of unnecessary returns, and fraud and abuse mitigation to our merchants’ eCommerce operations.”
PYMNTS spoke with Poma last year about the shift that has taken place in retailers’ approach to returns over the past few years, with more merchants now charging for exchanges, refunds and store credit.
In fact, Poma pointed out that 57% of merchants have instituted some type of return fee, a shift that comes in response to the statistic that customers in the U.S. return around 3.5 billion products each year, with just 20% of those items being defective.
However, he added, this change in pricing hasn’t triggered a change in shopper behavior as customers recognize the merchants’ need to recover costs and are willing to pay for returns as long as they get an exceptional returns and purchase experience.
“I think there’s like a quid pro quo that is, ‘Hey, as long as I’m getting a great experience, I don’t mind paying,’” Poma said.
As PYMNTS wrote last month, for every $1 billion in sales, retailers face an average of $145 million in merchandise returns.
Online sales show a greater return rate, at 17.6%, the equivalent of $247 billion in returned merchandise. By comparison, pure brick-and-mortar returns (excluding online orders returned in-store) stand at 10.02%, coming to $371 billion.
A recent National Retail Federation report suggests merchants are making some progress. After two years of increasing returns rate, the percentage of returns fell to 14.5% of total retail sales in 2023, equivalent to about $743 billion.