by Ethan Faverino | Oct 28, 2025 | Economy, News
By Ethan Faverino |
According to the newly released 2025 Retail Returns Landscape, U.S. retailers project that nearly $850 billion in merchandise will be returned this year, equivalent to 15.8% of total sales.
The figure, while substantial, reflects a slight decline from last year’s 16.9% return rate and $890 billion in total returns.
“Returns are no longer the end point of a transaction,” said NRF Vice President of Industry and Consumer Insights Katherine Cullen. “They provide an opportunity for retailers to create a positive experience for customers and can translate to brand loyalty. Retailers are constantly evolving and working to meet customer expectations, and they recognize the importance the returns process plays.”
While overall return rates remain steady, online sales continue to drive higher volumes, with an estimated 19.3% of e-commerce purchases expected to be returned in 2025.
Generational shifts are amplifying these trends, particularly among Gen Z shoppers (age 18-30) who averaged 7.7 online returns over the past 12 months, more than any age group.
Consumer demands for seamless returns are intensifying as 82% of shoppers now cite free returns as a major factor in their purchasing decisions, up from 76% last year. Additionally, 76% of shoppers are more likely to choose the return method offering instant refunds or exchanges.
However, a negative returns experience carries significant consequences: 71% of consumers report they are less likely to shop with a retailer again following a poor encounter, rising from 67% in 2024. Four out of five consumers say they are likely to share their bad experience with friends and family, potentially magnifying reputational damage.
Retailers are navigating these expectations while contending with escalating operational costs and external pressures. Surveyed merchants identified increasing online sales and reducing return rates as their top priorities in 2026.
Key drivers for charging return fees include:
- Processing costs (40%)
- Higher carrier shipping expense (40%)
- Economic uncertainty tied to tariffs (33%)
Return fraud remains another persistent challenge, accounting for 9% of all returns. Among retailers tracking fraud, 71% reported an increase in overstated return quantities, 65% noted “empty box” or “box of rocks” incidents, and 64% saw rises in decoy returns involving counterfeit items. To combat return fraud, 85% of retailers have begun to use AI to detect or prevent fraud from happening.
Notably, 45% of consumers—particularly when dissatisfied— believe that “bending the truth” is acceptable during a return.
David Sobie, co-founder and CEO of Happy Returns, said, “Return policies and their overall process have transformed into a strategic touchpoint for retailers, influencing how younger consumers shop from the outset. To stay competitive amid rising return rates and behaviors like bracketing, retailers must modernize their reverse logistics to enhance customer satisfaction, reduce fraud, and safeguard their operations in today’s high-pressure retail landscape.”
Looking into the holiday season, retailers anticipate 17% of holiday sales will be returned, consistent with prior years. To manage this surge, 49% plan to lean on third-party logistics partners, 43% will hire seasonal staff, and 37% intend to extend return windows.
Ethan Faverino is a reporter for AZ Free News. You can send him news tips using this link.
by AZ Free News | May 8, 2021 | Economy, News
With more businesses reopening and bringing employees back to work, the U.S. economy is on firm footing and could see its fastest growth in more than three decades, National Retail Federation Chief Economist Jack Kleinhenz said today.
“While there is a great deal of uncertainty about how fast and far this economy will grow in 2021, surveys show an increase in individuals being vaccinated, more willingness to receive a vaccination, increased spending intentions and comfort with resuming pre-pandemic behaviors like shopping, travel and family gatherings,” Kleinhenz said. “This feel-better situation will likely translate into higher levels of household spending, especially around upcoming holidays like the Fourth of July and spending associated with back-to-work and back-to-school.”
“The consumer is nearly always the key driver in the economy, and with the consumer in good financial health, a sharp demand is expected to unfold over the coming months,” Kleinhenz said.
Kleinhenz’s remarks came in the May issue of NRF’s Monthly Economic Review, which
said NRF expects the economy to grow 6.6 percent this year, the highest level since 7.2 percent in 1984.
The report said the latest edition of the Federal Reserve’s Beige Book “affirms what the economic data has been signaling: U.S. growth is beginning to accelerate.” The Fed assessment and other data show unemployment benefits, government stimulus checks and tax refunds have provided a substantial increase in personal income and purchasing power. Consumers are “sitting on a stockpile of cash” that could become “a spring-loaded spending mechanism,” Kleinhenz said.
Among other favorable indicators, the $2.4 trillion saved by households during February alone was approximately twice the average monthly savings during pre-pandemic 2019 and comes on top of savings accumulated over the past year as consumers stayed home rather than dining out, traveling or attending sports and entertainment events.
In addition, use of consumer credit is up, with outstanding credit surging in February to its highest level since late 2017. The increase in borrowing “highlights a consumer who is growing more confident as the economy accelerates, job growth picks up and more states lift burdensome restrictions,” Kleinhenz said.
Kleinhenz cautioned that 2020’s “outsize swings” in economic data caused by the pandemic, hurricanes, wildfires and other events will make year-over-year comparisons difficult during 2021. Federal agencies have “tried their best with the information available” to make seasonal adjustments account for the swings, he said.
NRF’s calculation of retail sales – which excludes automobile dealers, gasoline stations and restaurants to focus on core retail – is based on data from the Census Bureau, which released its annual revision of retail sales going back to 2013 last week. NRF has revised its numbers accordingly, and now shows 2020 retail sales of $4.02 trillion rather than the $4.06 trillion originally reported. But 2020 grew 6.9 percent over 2019 rather than 6.7 percent because 2019 was revised down to $3.76 trillion from $3.81 trillion.
The annual update is done to replace previously reported data with more accurate data and to benchmark numbers to the Census Bureau’s Annual Retail Trade Survey. Retail firms are required by law to complete the annual survey, while the monthly survey is voluntary and sometimes reflects estimates and incomplete or unaudited records rather than final numbers.
Even with the revisions, 2020 sales broke the previous record of 6.3 percent set in 2004 despite the pandemic. NRF has forecast that 2021 retail sales – excluding autos, gas and restaurants – will grow between 6.5 percent and 8.2 percent over 2020 to between $4.33 trillion and $4.4 trillion.
