How Businesses Can Cope With Holiday Returns in 2022

December 17, 2021 by Maria Fagerland Leave a Comment

This year will be a big year for retailers and ecommerce businesses who will be subjected to a host of holiday shopping issues, returns being among them. During the 2021 holiday season, businesses will be facing a continued surge of online purchases as well as increasing supply shortages and delays that are both raising the cost of items as well as causing consumer dissatisfaction due to an inability to meet demand. According to data from Adobe Analytics, “out of stock” messages only will see a 360% increase over a two-year basis. Among the worst-hit items will be apparel, sporting goods, baby items, and electronics. 

This may result in customers buying substitutes for the products that they actually wanted—in some cases, the only option they can get in a category—which will not meet expectations of their original desired product. Compound this with the already-mounting frustration of out-of-stock items and shipping delays, and returns may be more plentiful and perhaps even more aggressive this year than in years past. 

While customers are much more likely to blame logistics providers such as UPS and FedEx for delays, an expected 21% of consumers will blame retailers.

During this year’s holiday season, businesses have another concern as well—the possibility of a “twindemic.” The potential of a worsened flu season through reduced immunity amid the ongoing Covid-19 crisis could result in a “twindemic,” or a pandemic of both the flu and the novel coronavirus. This may result in worker shortages or reductions due to illness as well as more strictly-enforced health and safety guidelines including social distancing and mask-wearing. 

What Will Returns Look Like In 2022? A Look To The Past

Among a host of unknowns, business owners may take some solace in returns—they are one thing this season we can reliably expect. Retailers expected 13.3% of holiday merchandise sold to be returned in 2020 resulting in over $100 billion expected in returns. A variety of factors could cause this number to increase during the 2021 holiday season. 

Effective Processes For Holiday Returns In 2021 and 2022

A major influx of holiday returns often occurs in the week of or following New Years, usually around January 4th. However, businesses can expect to see returns throughout late fall into early winter that are specifically related to the holiday season. 

Create A Holiday Return Policy That Differs From The Rest Of The Year

Large retailers such as Amazon and Apple have created extended return policies to span the holiday season. At Apple, they have extended their usual 14-day return window to span from November 1 to January 8, 2022 across several countries including Germany, Canada, and the US. Amazon’s holiday return policy is even more forgiving than Apple’s. At Amazon, purchases between October 1, 2021 and December 31, 2021 can be returned until January 31, 2022. 

Considering these retail giants almost invariably have more intensive data than practically any other retailer, it seems wise to follow suit. 

Other changes to return policies that retailers may implement to ease customer interactions include free return shipping, no-hassle policies, timely refunds, and printable return labels. 

Consider Supply Chain Outsourcing

Outsourcing to third-party logistics companies (3PLs) can create faster and easier returns processing. By bolstering the flow reverse logistics supply chains by adding more warehouses and distribution centers. These improvements and expansions can be especially beneficial in the overburdened holiday season. 

Out With The Old, In With The New, But Always The Right

If you want customers to value their purchases—thus making it less likely that they’ll return the items—then it’s important to attract the right mix of customers through the promotions you utilize during the holidays as well as the copy on your product pages.

Businesses commonly promote end-of-season products in order to create warehouse space and quickly move old product to make room for next year’s growth. It’s important to be clear whether or not you will be restocking items as well as to keep product pages up-to-date and accurate. It’s also common to promote bestseller, evergreen products among the seasonal sale items to help create the right mix of current, new, and (hopefully) returning, satisfied customers.

Consider Your Shipping Platform

Having a good shipping platform can make a world of difference year-round but especially during holiday season returns. Look for a shipping platform that offers automation opportunities. For example, shipping label automation can resolve a whole host of problems that can occur with human input. This can reduce shipping errors and delays during the holidays, thus reducing return rates. Additionally, automated integrations with 3PL companies such as linking product information and tracking numbers (both at the buying stage and at the returns stage) can eliminate friction for customers as well as provide visibility for both the customer and the business. 

Create Systems And Designated Areas

Have designated areas and systems for supporting an influx of returns. For some, this may look like expanded receiving areas, additional stocking and picking personnel, and utilizing barcode systems for inventory management. By keeping work areas organized and spacious enough to handle the extra workload as well as maintaining safe, clear, and efficient paths of movement can contribute to increased speed and accuracy with returns as well as more satisfied, more productive employees. 

Treat Workers Right

The holidays are stressful for workers, especially those in the supply chain, logistics, retail, and a host of other industries. Especially with the ongoing pandemic and potentially rough flu seasons, treating workers correctly is vital for success. Give workers time and space. Breaks and options for rest are critical to keeping morale up, burnout rates down, and general health is managed. Stress and overwork make workers less productive and slower as well more prone to illness and calling out. Treating employees right throughout the season can pay off in spades. Additionally, customers care more and more about this facet of business as well—poor working conditions can reflect poorly and cause reputational harm to a business resulting in loss of revenue and loyalty. 

Treat Customers Right

Adding customer service representatives as well as additional training can go a long way toward frictionless returns during the holiday season. Train workers on how to attune to customer needs and to convey kindness and to stay human and present during a stressful season when it can be easy to mentally and emotionally check-out. Especially in conjunction with a hassle-free return policy, customers will have an opportunity to have a good experience and will be likely to reorder. 

Treating people right is one of those evergreen correct answers, whether it’s your employees or your customers, and people as a whole will always appreciate it.