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Industry Spotlight: Free returns obstructing UK eCommerce?

IS-Fashion eCommerce storyProviding a free returns policy can offer a competitive edge to a retailer’s eCommerce platform. However, can such a service equate to a loss in profits, or create a gateway to extra earning potential?

As eCommerce continues to grow in stature, so does the impact of the number of returns made as a result of online purchasing. According to a recent study from Barclaycard, 57 per cent of retailers have claimed that the daily process of handling returns is adversely impacting on trade; with 20 per cent resorting to increasing stock prices to neutralise the effects, and, considering its current status, 22 per cent of UK high street retailers have opted out of the eCommerce trend due to the costs of managing a free delivery and returns policy.

It’s all well and good for Barclaycard to suggest that retailers need to improve their services – such as the introduction of local ‘drop-off’ points and hourly courier services – but how can businesses implement beneficial changes without sacrificing on product quality and in store operations? Despite the struggle, this, according to Barclaycard’s director of customer solutions, Sharon Manikon, can be simple to manage: “Online spending will continue to rise and the need to keep pace with customer demands presents a dilemma for businesses needing to protect their bottom line. Fortunately there is light at the end of the tunnel with many ways retailers can streamline the returns process. From developing universal sizing to offering virtual dressing rooms, the key for today’s businesses is to determine which innovations work best for them – while ensuring they don’t lose out to their more savvy competition.”

Even so, with the research additionally finding that 30 per cent of consumers are purposely over-buying via online and returning the items at a later date, it is clear that an intervention across the board needs to be demonstrated. Reportedly, services such as the Metail app are currently being trialed as an inclusion by many UK clothing retailers, where a consumer can upload an image of themselves and virtually try on the clothing to check for the correct sizes before purchase.