Shopper returning an ecommerce purchase

Why Retailers Shouldn't Fear Return Fees

Online retail is booming. Unfortunately, much of that "boom" is being offset by rising acquisition costs, steady competition, and surging return rates. Ecommerce retailers are scrambling to keep up with the competition without recklessly adding to their operational costs. One of the easiest ways retailers can do this is by eliminating free returns. At first glance, this no doubt seems like an ill-advised move—fees will scare away customers accustomed to returning purchases for free.  However, there are several reasons why retailers shouldn’t be afraid of implementing return fees. In this blog post, we’ll discuss the benefits of charging for returns and how Narvar can help streamline the process.

The perks of saying no more free returns

One of the most obvious advantages of charging for returns is that it can reduce return rates. Generally, customers are less likely to return an item if they know there’s a fee associated with the process. In other words, customers are more likely to purchase with care if they know there will be a fee associated with their return. 

Retailers stand to benefit from this reduced return rate because it leads to decreased operational costs and improved bottom lines in terms of profit margin. Moreover, it reduces the likelihood of inventory shortages that lead to lost sales. An additional benefit to avoiding those pesky “out of stock” notices?—It leads to improved shopper satisfaction and loyalty long-term as shoppers know they can trust your brand to have what they need when they need it.  

Another reason why retailers need to say “no more free returns” is that by charging a fee, they can recoup some of the costs associated with returns, from shipping and restocking costs to lost product value (returned items are often resold at a markdown).  

(Worried about turning off your best customers?—Don’t be. You can always implement VIP return policies that provide your most-valuable customers with special perks such as free returns. Similarly, you can continue to provide free returns to all customers who meet a certain order minimum or register for your loyalty program). 

Don’t say “no more free returns” without a great partner

To avoid unexpected roadblocks or disappointments, don’t start eliminating free returns until you get a reliable partner in place to help you manage the returns process. Look for a partner who can help you:

  • Create and implement customer-friendly return policies
  • Automate large swaths of the return process, thereby lowering operational costs
  • Tap into a global logistics network to easily manage complicated returns and exchanges (e.g., cross-border transactions) 

Once you find the right returns partner, everything from your return strategies to your return fees will start to fall into place. You’ll see your return rates start to decline and the funds you’re collecting in fees cover the costs associated with processing the few returns that remain. But best of all, you’ll increase customer satisfaction and your bottom line all at once, without being beholden to the pressure of providing free returns.  

What makes Narvar a great partner

Remember, there are numerous benefits associated with charging for returns including reduced return rates, the recouping of processing costs, improved profitability, increased customer loyalty, and more. 

For retailers looking to implement return fees, Narvar is the ideal partner. With its comprehensive suite of features and services, retailers can easily set return fees and restocking fees while leveraging Narvar's global logistics network to manage the nuts and bolts of the returns process with ease. Stop worrying about rising operational costs or high return rates—with Narvar, retailers like you can finally make their return process as efficient and effective as possible. 

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