Zara’s return policy is quite strict. The garment must be in the same condition as when it was purchased. In the UK, the company has even started charging $1.95 for returning purchases by post. In fact, 37 countries now have return costs.
There are currently no return fees in the United States. However, it could happen. Zara’s returns policy in the US is already quite strict (items must be accompanied by a receipt, returned within 30 days and in pristine condition), but I think the current global economic conditions are considering Zara and some other companies to charge for the return of goods.
Especially lately, customers have abused the returns system. Many shoppers buy a few different items or order two or three sizes to make sure they fit properly. Subsequently, rejected selections and incorrect sizes of the garments ordered will be returned for credit. Since Zara consistently cuts garments to size, it is really an outrageous practice that is costly to the company for customers to constantly make such returns.
Of course, during the pandemic caused by COVID-19, when stores were closed and customers were reluctant to shop in person as they slowly reopened, customer needs were met by shopping online. At the time, just under 40 percent of retailers charged for returned goods. Rising costs have caused some retailers to reconsider this policy as they look at every penny that can be recovered as it affects the store’s profitability.
I’d always argued that the now-defunct, semi-annual catalogs that Sears and JCPenney sent out should be written in plain language with specific trade information to help customers make their choice and order with confidence. Back then, no one (customer or retailer) wanted to deal with the hassle (or expense) of handling returns.
Now let’s look at more recent shopping activity. From a retailer’s point of view, the convenient, often free returns policy has created problems. Online shopping has added a lot of shopping costs. The goods must be selected, carefully packed, delivered and finally received by a customer. The sales process lacks the seller’s comments (such positive reinforcement as ‘Oh, that looks great on you) and the customer may have doubts about her purchase. The lack of such reinforcement during the purchasing process often encourages customers to purchase items with the intention of returning some of them after viewing them at home. And since the price of a Zara garment (or any other brand) has skyrocketed, making every purchase a special transaction, customers naturally benefit from the process.
This results in real, measurable costs for retailers. But can stores here in the US stop offering free returns? UPS claims it will process 60 million returns this year (after Christmas), which is 10 percent more than last year. It’s no surprise as more customers are now being trained to use the internet for purchases.
As mentioned above, return costs are seen in other countries. In the UK, Uniqlo and Next also charge for returns. Uniqlo sends a return label that costs $7 since March 1, 2021. On the other hand, Shein allows a free return for the first time and then charges $7 for subsequent returns.
POSTSCRIPT: Some customers continue to expect free returns, but savvy retailers have now discovered that internet costs have become so exorbitant that they need to rethink their business model. It could very well mean that stores have to charge for returns. Operating costs have risen dramatically and will continue to pressure management to increase prices and treat such costs as return costs as well. Nobody likes the idea of increasing customer costs, and it will have to be done with charm. But I think it’s likely that many other retailers will join in.