"$173 Billion in Returns in One Month... The Aftermath of U.S. Shopping Season Looms [New York Diary]"

Return Season Begins After Christmas
More Customers Visit Stores to Avoid Return Fees
Retailers Struggle with Soaring Costs from Post-Holiday Returns

On the 28th (local time), after the Christmas holiday, a long line formed on one side of the first floor of Macy's department store located in Manhattan, New York. It was a service center for picking up online purchases, but on this day, many people were carrying large boxes or paper bags. Upon closer look, it was a line for returning items purchased during the year-end shopping season in November and December. A Macy's employee said, "December 26 marks the start of the 'return season,'" adding, "This year, it seems more customers are visiting stores in person to avoid return fees."

In the United States, the period from Thanksgiving to the Christmas holiday is called the year-end shopping season. Retailers launch massive discounts, and customers flock to buy gifts for family and friends. Major shopping events like Black Friday and Cyber Monday, the biggest shopping days in the U.S., also fall within this period.

After the Christmas holiday ends, a full-fledged return season begins, lasting about a month. Local media even describe this period as the start of the "Post-holiday Returns Hangover." Return service provider Optoro predicted that American consumers will return goods worth approximately $173 billion (about 223 trillion KRW) from Thanksgiving this year through the end of January next year. According to a survey by YouGov, about 4 out of 10 people said they would return at least one item.

Returns have always been a headache for companies. Each return incurs additional shipping and labor costs, reducing profits. According to logistics company Narvar, the cost to recover and resell a $100 item is estimated at $32. Returned products rarely sell at full price. Some items go back on store shelves, but many go through warehouse workers' sorting processes and end up in discount stores, donations, or disposal.

The United States, known as a "return paradise," has long implemented generous return policies. Companies have borne the additional costs of returns, believing that return policies help attract customers and increase sales. However, there is now widespread assessment that these costs have become unsustainable.

According to the National Retail Federation (NRF), shoppers returned 16.5% of items purchased online and offline last year, amounting to about $817 billion. Research firm Gartner also noted that return issues have nearly reached $1 trillion, and companies can lose up to 50% of their margin during the return process. The surge in online shopping after the pandemic and the so-called "bracketing" shopping behavior?buying multiple sizes and colors of a single pair of shoes and returning all but one?have intensified this problem.

Recently, many companies, unable to bear the cost burden, have ended free online return policies, leading to an increase in customers visiting stores in person to avoid return fees. Macy's has also started charging $9.99 for returns of online orders for customers not enrolled in the Star Rewards program. However, if customers visit the store, they can return items purchased online or offline or received as gifts free of charge. The items stacked neatly for return that day will go through sorting again and then be placed back on store shelves, sent to discount stores, donated, or disposed of.

Among these, some consumers take advantage of the return season. Under the name of the "After Christmas Sale," special discounts are often offered on unsold and returned items. A woman who was standing in line with a paper bag for returns at Macy's that day headed straight to the Backstage discount store on the 8th floor right after completing her return. This is another year-end consumption scene that draws more attention in the era of high inflation.

This content was produced with the assistance of AI translation services.