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Go from problem to profit without compromising the customer experience Why returnmatters more than ever This guide is the third in our three-part practical series focused on the critical post-purchase moments that shapecustomer experience and business growth. Together, Checkout, Tracking, and Returns form theMoments That Matter—high-impact touchpoints that determine whether a shopper becomes a loyal customer or a one-time buyer. In this installment, we focus on Returns — the moment that retailers often dread, but that customers expect tobe easy, fast, and fair. Handle it well, and you keep the relationship intact. Handle it poorly, and you may lose thecustomer for good. In this guide, we’ll show you how to: •Reduce avoidable returns at the source•Streamline the process for both customers and teams•Use return data to improve products and protect margin•Turn refunds into exchanges and loyalty drivers Let’s explore how to take control of the most underestimated post-purchase moment — and fix the returns. The business case forfixing returns Returns are a costly reality of modern e-commerce. From restocking and reverse shipping tolost revenue and strained customer relationships, every return takes a bite out of your bottomline. In the UK alone, returns hit an estimated£4.1 billion in 2023, and that figure is expectedto rise16.7% by 2027, according to GlobalData¹. Globally, ecommerce return rates are projected to reach$1.4 trillion in 2025. In the US alone,3.5 billion productswere returned in 2023, and only20%were found to be defective. Thissuggests that better information, sizing, and expectations upfront could prevent a significantshare of returns altogether. Return fraud alone cost global retailers an estimated$101 billion in 2023, with average losses of$13.70 for every $100 in returned merchandise2.And that doesn’t include common but costly behaviors like bracketing or wardrobing, which further inflate operational costs. Return rates also vary widely by category ³— for example: A smarter approach As pressure grows to protect margins, retailers are increasingly asking the samequestion: how can we fix the returns problem? For some, the answer has been return fees and stricter policies. But while that may lowervolume, it also risks frustrating customers and pushing them elsewhere. The smarterapproach is a balanced one —reduce avoidable returns at the source, and make therest easier, faster, and more valuable. This is where technology makes a difference. With better visibility, automation, andcentralized data, retailers can prevent unnecessary returns, streamline reverse logistics,and even turn some refunds into revenue. Done right, returns can be a lever for bothefficiency and loyalty — instead of just a cost center. This presents both a challenge and an opportunity. With the right tools and processes,retailers can reduce returns before they happen, better manage the ones that do, andbuild loyalty in the process. To help you get there, this guide exploresfour practical strategiesto reduce returnrates, improve your process, and build stronger relationships with the customers whoreturn. Let’s fix the returns — and go from problem to profit. Importantly, the environmental cost of returns is also gaining attention. Switching fromtraditional label-in-the-box models to digital, self-service returns helps cut packagingwaste and lower emissions — a move appreciated by the growing segment of eco-conscious shoppers. #1 Reduce returnsbefore they happen The most profitable return is the one you never have to process. With shoppers expectingfree and easy returns— 76% say so,according to the DeliveryX Returns Report⁴ — many retailers are absorbing those costs. That makes reducing preventable returns adirect margin saver. Start with better product clarity.Make sure listings include accurate, complete descriptions and clear images. Include size chartsand customer reviews that help set realistic expectations. If you frequently see returns flagged as “item not as described” or “wrongsize,” it’s a sign those details need refining. Fulfillment matters, too.A mislabeled product, wrong item, or poor packaging can instantly trigger a return. Tightening warehouseaccuracy and adding quality checks at dispatch helps prevent returns that stem from internal errors — issues nShift helps flagthrough centralized tracking and return data. But the real unlock comes from return reason data. When customers submit a return request via a digital portal (like those poweredbynShift Returns), they select a reason — and that insight adds up quickly. If a specific SKU is returned at twice the average rate, or“quality issues” spike in a certain category, you can act. Tweak the listing. Flag the supplier. Fix the upstream problem before it scales. Retailers in high-return categories like apparel and electronicsbenefit most from this approach.For instance, a 23% return rate in clothing is often tied to inconsistent sizing or poor f