H&M is expanding its test of charging customers who return items purchased online.
The retailer first piloted the program last September, charging customers $5.99 in the U.S. Now it has added the U.K. to the program, though customers there are only required to pay £1.99/$2.47 for each package.
The move is meant not only to discourage returns and save money, but also to reduce H&M’s environmental footprint, as carbon emissions from returned packages have grown considerably in the past four years. One report from The Guardian claims as much as half of the clothing bought online is returned.
Customers won’t be charged if the item is found to be faulty or the wrong item was shipped. Additionally, if they’re members of the company’s loyalty program, there is no charge for returns. In-store returns also do not face any charges.
Customer returns are a growing problem for retailers, especially when it comes to online purchases. In 2022, returns cost retailers about $816 billion in lost sales. That’s nearly as much as the U.S. spent on public schools and almost twice the cost of returns in 2020.
Processing those returns also substantially increases labor costs, as the packages need to be unpacked, inspected and routed.
H&M is hardly alone in charging for returns. Several retailers are now charging return fees to cover either shipping or labor fees. A sampling of the costs:
- Abercrombie & Fitch: $7
- Anthropologie: $5.95
- Dillard’s: $9.95
- Foot Locker: $6.99
- JCPenney: $8
- Crew: $7.50
- Wayfair: $4.99 for orders under $35
H&M says it plans to expand the charge-for-returns policy to stores in other countries in the coming months.
