UK retailers urged to streamline returns as costs hit £27 billion
Aramex UK has called for improved returns management among UK retailers and eCommerce businesses as return volumes continue to increase across the sector.
According to data provided by Savills, global consumers are expected to return goods worth USD $1 trillion in 2025, reflecting ongoing growth in both eCommerce sales and return activity worldwide. Projections indicate global eCommerce sales are set to surpass USD $7.9 trillion by 2028, intensifying the scale and complexity of returns challenges facing retailers.
Changing shopper expectations and behaviours have contributed to an ongoing rise in return rates, particularly within the UK fashion industry. Practises such as 'bracketing', where consumers purchase multiple sizes or colours intending to return unwanted items, and 'wardrobing', which involves buying items with the intent of wearing them once before returning, have become increasingly common.
Recent industry figures show returns cost UK retailers an estimated £27 billion in the previous year, with online return rates averaging around 20 percent. In the fashion sector, return rates may reach as high as 30 percent.
Research indicates that nearly two-thirds of UK online shoppers now expect free and straightforward returns as a standard part of their shopping experience. While such policies have been effective in building trust and encouraging confidence in purchasing, they have also contributed to an environment that enables over-ordering and increases demands on retailers' reverse logistics operations.
Aramex UK, which provides logistics solutions for fashion retailers and eCommerce brands, has highlighted the importance of prioritising efficient and cost-effective returns processes to support competitiveness amid these ongoing challenges.
Haissam Badr, Aramex UK, stated: "Long gone are the days where retailers can treat returns as an afterthought. The way buying habits are changing means that consumers, especially those among the younger generations, now expect a frictionless return process that is entirely hassle free and doesn't compromise their overall shopping experience. Failing to deliver on this will only translate into lost business by driving customers to competitors, as once that customer experience is damaged, it's nearly impossible to win back that trust. We live in a time where consumers have countless alternatives at their fingertips, so a poor returns experience can be the difference between a one-time purchase and gaining a lifelong customer."
Badr continued, "Consumers essentially expect the same convenience in returning items as they experience during purchase, and that's now becoming a challenge for retailers that haven't adapted their reverse logistics strategies to cater to this demand. On top of this, there's also the hidden cost element which retailers may not consider - the operational burden of processing returns. Each returned item carries multiple cost layers, including reverse transport, inspection, repackaging or disposal, re-stocking, labour, and warehouse space, returns also create additional challenges such as items sitting idle, reducing cash flow and increasing the likelihood of discounting products or potentially writing them off altogether."
Aramex UK emphasised that simplifying the returns process and minimising the number of required steps are essential for maintaining customer satisfaction and ensuring efficient operations. The ongoing growth of global eCommerce further compounds the pressure on retailers to improve these systems. According to Aramex UK, neglecting optimisation of returns management can significantly increase a retailer's overall logistics costs.
Badr said: "Having a returns policy just for the sake of it isn't enough. The key is to optimise the supply reverse chain element, so it benefits both customers and the business. Retailers should prioritise efficient pickup options and leverage automated labelling to reduce errors, while also addressing challenges such as bracketing, where shoppers order multiple items with the intention of returning most of them.
"Equally, by integrating cutting-edge technology such as AI, real-time tracking and cloud-based systems, businesses can paint a much clearer picture of what's happening across their returns process. This not only helps them manage stock more effectively by spotting patterns such as peak return periods or popular exchanges but gives them the opportunity to accurately plan ahead to keep costs and waste down. This level of insight also supports sustainability by reducing unnecessary shipments."
Aramex UK has suggested that with no indication of eCommerce return rates slowing, UK retailers and brands will need to continue evaluating and refining their approaches in order to manage operational burdens and maintain both profitability and customer loyalty.
