Surviving Holiday Returns

’Tis the season of returns.

More than 9 percent of all purchases will be returned, according to the National Retail Federation.

With consumers spending $45 billion on this past Black Friday weekend alone, returns can feel like a tidal wave during the holiday. However, Tom Rittman, marketing vice president for Irvine, Calif.–based software company The Retail Equation, said if returns are handled in the right way, they can end up making money for the retailer.

Perhaps it could be called a return on investment on returns. If a retailer’s return policy is considered efficient, fair and a pleasant experience, consumers might buy another item in the store when making the return. Rittman said these purchases could raise store sales by more than 1 percent.

“When you get a return, you have someone who already made a purchase in your store. You can dramatically increase sales,” Rittman said. He suggested retailers build a return loyalty program for their customers. If they make a return, they can be given credit for another purchase.

There are two general policies every retailer should follow, Rittman said. First, make the returns process as speedy and efficient as possible for all customers. Second, a retailer’s better customers should be given some breaks. For example, if a good customer makes a return a few days after the returns deadline, the customer still should be allowed to make the return.

Store staff also should be well-versed in a retailer’s return policy to quickly handle the transaction.

Retail Equation publishes software to combat return fraud. The software is called the Verify-2 Return Authorization System.—Andrew Asch