Your holiday gift returns cost retailers billions
‘Tis the season to return unwanted holiday gifts — and for retailers to lament the impact of all those boomeranging sales on their bottom lines.
Approximately $70 billion worth of products may be returned this holiday season, according to returns logistics and solutions firm Optoro. While retailers can resell some of those items or foist them off on liquidators and discount chains, much of the value of returns is lost as they move through the supply chain.
Just how much do businesses lose? Last year, Americans returned about $284 billion in merchandise, according to the National Retail Federation. Optoro CEO Tobin Moore told CNBC anywhere from a quarter to half of that value cannot be recouped, leading to tens of billions of dollars of losses.
Close to 10 percent of goods sold at any time get returned, but the end of the year sees a surge in activity. Nearly a quarter of all returns occur around Christmastime, Optoro says.
How much retailers can salvage largely depends on the nature of the return, Moore told CNBC’s “Squawk Box” on Monday.