Author: Bianca Nicula
Graphics: Business Review at Berkeley
Behind every easy return is a harder truth: discarded goods, rising emissions, and a retail system built on waste we’re never meant to see. Every click to return comes with hidden costs– where convenience for consumers turns into waste for the planet.
An Economy of Returns
In lieu of sacrificing style or creativity, consumers are choosing to indulge in behaviors that prioritize convenience over consideration for the planet. Practices like wardrobing, as in the act of buying a product with the intention of returning it, is at an all time high. At the surface, it seems like the ultimate life hack. An ever-evolving closet with a piece perfect for every occasion and need. The National Retail Federation reported that the average retailer accounts for $145 million in returns for every $1 billion in sales. An increasingly digital world has begun to leave in-person shopping behind in favor of the convenience of online shopping. The novelty of Black Friday is now overshadowed by promotional online discounts on Cyber Monday. The global pandemic permanently tipped the scales, exacerbating the online shopping frenzy past the point of no return. The spike in retail spending around the holidays is inevitably accompanied by an avalanche of returns. In 2020, an average of $70 billion in online purchases were returned– a 73% increase from the previous five-years. Most consumers assume that the traditional in-store return process, where items are quickly evaluated and are likely placed back on the shelves, still applies to online returns. When profit margins reach the millions, corporations adopt an economy of scale, minimizing production costs by substantially increasing output. The effects of facilitating a traditional return in these conditions range from financially inconvenient to downright detrimental. When the price of a return exceeds the cost of the item itself, corporations start taking shortcuts to minimize losses, ultimately misleading consumers and adding to the seemingly insurmountable burden on the planet’s shoulders.
How Many Returns can the Planet Afford?
The Rise of the Return-less Refund
In 2023, the retail value of product returns in the U.S. alone approached $1 trillion. 60% of the 500 US-based retailers surveyed this same year admitted to issuing refunds without requiring buyers to physically return the item(s). The boom in online shopping revolutionized the buy-and-return process, as online purchases are at least three times more likely to be returned than in-store purchases. The concept of the “keep-it return” historically applied to larger furniture items that would have been inconvenient to send back. E-commerce giants like Amazon, Shein, Target, and Temu saw a need to prevent growing revenue losses from this trend and began allowing keep-it returns for a much wider variety of products and purchases. Keep-it returns are most common on low-ticket items that don’t make fiscal sense to try to resell. If there isn’t a profit to be made, corporations are asking: Why bother?
Behind Closet Doors
Consumers think they’re winning, the corporation outrageously profits, and the planet loses again. A record-breaking number of returns is generating nearly 6 billion pounds of landfill waste a year, in addition to 16 million metric tons of carbon dioxide emissions. This figure grows exponentially with greenhouse gas emissions from the transportation used to ship back returned items, along with the practices of “energy recovery” used by powerful retailers. In total, the fashion industry is responsible for about 10% of global carbon emissions. Essentially, most of your favorite retail brands have adopted disposal practices that include incinerating unsold merchandise in the name of brand exclusivity. Rather than place the remaining stock on sale and perpetuate the idea that their products don’t deserve to be sold at their original price. Burberry made international headlines after setting fire to unsold stock valued at approximately $40 million. H&M burned 60 tons of new, unsold clothes since 2013. Coach, Urban Outfitters, Micheal Kors, Victoria’a Secret, and JC Penny also engage in this destructive practice. As many as 40% of clothes made each year, totaling up to 60 billion garments, are not sold. This overproduction is facilitated by the fast-fashion business model, which incentivizes volume to keep production costs low. Producing cheap, low-quality clothing for trend cycles facilitates wasteful return processes. When it takes about 700 gallons of water to produce a single cotton t-shirt, consumers have to understand that they’re deliberately kept in the dark about the impacts of their shopping habits and that there’s more at stake than ever before.
Breaking the Linear Fashion Cycle
There are already enough clothes on the planet to dress the next six generations. Supply chains in the U.S. are generally designed in a one-way direction, marching ever-forward towards eventual destruction. It’s time for companies and consumers alike to get creative. Initiatives like Nike’s upcycling of shoe returns, manufacturing scraps, and end-of-life sneakers through their Reuse-a-Shoe Program, give these products a new life by shredding them into their patented Nike Grind material used to create tracks and other athletic surfaces. Consider second-hand shopping as an alternative to finding high-quality pieces you resonate with, rather than a cheaply made piece you ordered on a whim. If you receive your package in the mail and regret your purchase, resell it to someone else or donate it!
Convenience at a Cost
In this age of corporate deception, it’s key to remember that consumers hold the power. It starts with recognizing that our shopping habits have been shaped by online retailers for decades. By making returns free and convenient, the company incentivizes shoppers to believe that their overspending habits are sanctioned by the company itself. When profit margins grow large enough, corporations are tempted to create more waste than ever and have no problem doing so. Whether they’re sacrificing product quality or the environment, these are small prices to pay for loyal shoppers hooked on the ease of the endless buy-and-return cycle. While it’s never been harder to become a conscious consumer, it’s also never been more important.
Take-Home Points
- As online shopping and wardrobing rise, returns have become so costly at scale that retailers prioritize loss-cutting over sustainability, pushing the environmental burden out of sight.
- Because online purchases are returned far more often and many low-cost items aren’t worth reselling, retailers increasingly issue “keep-it” refunds instead of processing physical returns.
- Most returned products are not actually resold, and many are discarded, liquidated, or burned because companies have little financial incentive to handle returns responsibly.
- The modern return cycle creates massive landfill waste and carbon emissions, while fast fashion’s overproduction and brand-driven disposal practices make the environmental damage even worse.
- Reducing retail waste requires circular alternatives—like upcycling, secondhand shopping, donating, and resale—that keep products in use instead of sending them toward destruction.
- Free and frictionless returns train consumers into overspending habits while encouraging retailers to tolerate more waste, making conscious shopping harder but more necessary than ever.