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Industry Unfiltered
United States
เข้าร่วมเมื่อ 12 ธ.ค. 2022
Why Are Retailers Trying To Phase Out Return Policies?
Retailers are facing a significant issue-not inflation, shrinkage, or self-checkout lines, but a problem with returns. Dr. Overstreet highlighted that out of approximately $5 trillion in retail sales last year, 14.5% were returned, amounting to a staggering $743 billion. In response, many retailers have started changing their return policies. For instance, 81% of retailers introduced pay-to-return policies in some form in 2023. Contessa Brewer Kroening noted that companies like Amazon and Macy's have added return fees or shortened the return window for online purchases. This tightening of return policies is largely due to return fraud, which is expected to account for 16.5% of holiday returns this year, equating to $24.5 billion. The rise of e-commerce has exacerbated the issue, as retailers have had to absorb costs related to postage, transit, and lost items. As a result, major retailers are making it tougher for fraudsters and reducing overall return costs.
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A 2018 report by The Wall Street Journal highlighted a largely unspoken policy of big-box retailers: tracking and profiling risky return behavior, even banning customers from making returns in the store based on their return score, despite these customers seemingly having done nothing wrong. But what is a return score? Who's keeping track? And what do they know about me? Simply put a return score is like a credit score. Its comprised of a number factors that tells retailers if you’re abusing their return policy. The most prominent company in this field is The Retail Equation. According to its website, The Retail Equation collaborates with individual retailers to define what they consider potentially fraudulent behavior. The company's software then tracks customer return behavior and assigns a score to customers who may display such behavior. Typically, the software monitors factors such as the frequency of specific transaction types, transaction values, and whether the customer has a receipt or purchase history at that retailer. In practice, this can encompass a range of activities. According to The Wall Street Journal, these activities might include making several returns in a short period, returning a large portion of a purchase, forgetting a receipt, returning an expensive item, returning frequently stolen items, or even making a return close to closing time. These actions can negatively impact a customer's return score, meaning that even shoppers adhering to a return policy might be penalized. Many customers might be unaware of their score or how it affects them. For some, this could result in a warning at the return counter or an outright ban on making returns at a retailer. Eventually this led to several class action lawsuits against The Retail Equation between 2020 and 2023, though these suits were eventually dismissed. Plaintiffs in these cases claimed that the software often provided incorrect information and offered shoppers little recourse for accessing or correcting the data The Retail Equation collects. The lawsuits also alleged that this data was supplied to The Retail Equation without the consumers' knowledge or consent.
The issue is that these types of complaints are challenging to substantiate. Often, the relevant policies are hidden in the fine print of Retailers' Terms of Service or Return Policies. “It's not something you can opt out of because if they decide to outsource their return logistics to a third party, by agreeing to the purchase, you're also implicitly agreeing to the third-party logistics provider for returns.” According to a Wall Street Journal report, the Retail Equation worked with 34,000 stores. The 2021 class action lawsuit named several retailers as defendants, including Dick's Sporting Goods, Best Buy, and Advance Auto Parts. Other retailers like Home Depot and TJ Maxx have also been identified as past users of Retail Equation services. This brings us to a larger question: If retailers have been implementing these targeted policies for a while, might they now implement broad policy changes? “With rising interest rates, retailers are thinking, ‘There’s a piece of cost here that isn't necessary.’” Essentially, it is much more expensive to be a retailer now, meaning they must cut costs in historically costly areas to turn a profit. According to the Retail Equation's own data, the US retail industry lost over $101 billion to return fraud and abuse in 2023, not including the cost of legitimate returns. “Most returns cost up to 40% of the original retail price to restock, and there’s no guarantee they can resell the item at the original price, leading to losses on both ends.”
So what are your thoughts?
Before we continue the video, please support the channel by hitting the subscribe button, like button, comment below, and also share the video. Thanks for watching.
A 2018 report by The Wall Street Journal highlighted a largely unspoken policy of big-box retailers: tracking and profiling risky return behavior, even banning customers from making returns in the store based on their return score, despite these customers seemingly having done nothing wrong. But what is a return score? Who's keeping track? And what do they know about me? Simply put a return score is like a credit score. Its comprised of a number factors that tells retailers if you’re abusing their return policy. The most prominent company in this field is The Retail Equation. According to its website, The Retail Equation collaborates with individual retailers to define what they consider potentially fraudulent behavior. The company's software then tracks customer return behavior and assigns a score to customers who may display such behavior. Typically, the software monitors factors such as the frequency of specific transaction types, transaction values, and whether the customer has a receipt or purchase history at that retailer. In practice, this can encompass a range of activities. According to The Wall Street Journal, these activities might include making several returns in a short period, returning a large portion of a purchase, forgetting a receipt, returning an expensive item, returning frequently stolen items, or even making a return close to closing time. These actions can negatively impact a customer's return score, meaning that even shoppers adhering to a return policy might be penalized. Many customers might be unaware of their score or how it affects them. For some, this could result in a warning at the return counter or an outright ban on making returns at a retailer. Eventually this led to several class action lawsuits against The Retail Equation between 2020 and 2023, though these suits were eventually dismissed. Plaintiffs in these cases claimed that the software often provided incorrect information and offered shoppers little recourse for accessing or correcting the data The Retail Equation collects. The lawsuits also alleged that this data was supplied to The Retail Equation without the consumers' knowledge or consent.
The issue is that these types of complaints are challenging to substantiate. Often, the relevant policies are hidden in the fine print of Retailers' Terms of Service or Return Policies. “It's not something you can opt out of because if they decide to outsource their return logistics to a third party, by agreeing to the purchase, you're also implicitly agreeing to the third-party logistics provider for returns.” According to a Wall Street Journal report, the Retail Equation worked with 34,000 stores. The 2021 class action lawsuit named several retailers as defendants, including Dick's Sporting Goods, Best Buy, and Advance Auto Parts. Other retailers like Home Depot and TJ Maxx have also been identified as past users of Retail Equation services. This brings us to a larger question: If retailers have been implementing these targeted policies for a while, might they now implement broad policy changes? “With rising interest rates, retailers are thinking, ‘There’s a piece of cost here that isn't necessary.’” Essentially, it is much more expensive to be a retailer now, meaning they must cut costs in historically costly areas to turn a profit. According to the Retail Equation's own data, the US retail industry lost over $101 billion to return fraud and abuse in 2023, not including the cost of legitimate returns. “Most returns cost up to 40% of the original retail price to restock, and there’s no guarantee they can resell the item at the original price, leading to losses on both ends.”
So what are your thoughts?
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thats funny if you ask anyone at AZ what WITTDTJR means they will tell you its not for looking parts or holding warranties. wittdtjr is literally the same as fast food upselling the acronymn is What It Takes To Do The Job Right. they also punish and fire employees based off how much wittdtjr you sell like brake grease, battery grease etc. solely because they are items the company makes the most profit on they get each pack for 12cents and sell them for 1.99$.
I'm here because the last Quiznos in my state is gone. No other companies can toast their sandwiches like Quiznos. I will miss them 😢
White lives matter
Sue someone lol
Im going to be honest, I did not expect the Cheesecake Factory to have such a concentration in the Arabian peninsula when it comes to their international reach. Getting into Dubai before Canada was quite a shock. I know there are American immigrant communities throughout the Arabian peninsula and the gulf states, is that a major reason why they are so strong? Or has it also reached into the local native communities as well? Also great job presenting this and condensing into an approachable format! I went to the Cheesecake Factory and I’m now super interested in knowing about its history and cultural impact.
Because of his love of Cow 🐄 s they wanted to name some thing with corral… they wanted the name platinum corral, but it had already been trademarked so they decided upon golden corral and the rest is history
Hands down the best tasting subs imo, but completely understandable why they declined.
This video needs to be played at 1.25x speed.
Smith Melissa Lewis David White Linda
From my point of view Nextel should have been a stand alone company just a punch of bs lies had me waste my money what was the point of these phones you couldn't even use them
Quiznos toasted their subs… and their franchisees! Too soon?
greed!!
Why do you have a different accent now?
Jackson Linda Jones Maria Clark Nancy
Their commercials were super cursed
I ❤ My Job.
You were close on their business model. Not only might you hold it for 73 more miles for the bathrooms, but the food & cheap gas as well. If you have one at mile marker 1 & the next one at mile marker 200, you may stop at the first or wait for the second for the better deal. Business on the interstate with over priced gas, insipid food, & filthy bathrooms will have to step up their game. They plan on vacuuming up most of the traffic. Will it hurt mom & pop shops? If they are on the interstate, yes. It probably won't if they are tucked away somewhere. Avoid Buc's on a race/game day close to the event. It can be insane.
KFC is not American it's polish
This would be bad for me, I live 5 minutes from ACY and they basically only fly spirit, they would probably go out of business or the route of ACY to MCO would be cut and we would have to go to Philadelphia, which is not only a longer flight to Orlando (I have family in Florida and they fly up and we fly down to see them) but it’s also wayyy less convenient
That's the whole problem if some people don't get what they want on the job they always use the excuse to sue the people they work for citing discrimination and racism which most of the time that's not the case it's just poor performance and attitude with the employee
Thanks 👍 for your help 🤖🤖❤❤❤❤❤
So the judge said the merger would prevent people from having more choices by making such choice go out of business 😂
The history of Texas Roadhouse: lawsuits
Im glad you spoke on the price of wings
They ruined themselves with the major rebrand/remodel of the mid 1990s stripping down all unique personality design.
Talking “white” is a ignorant phrase; all black people have to talk like rappers?
Naaahhh. It was that rat commercial
I think that Spirit might fail because all the big 4 airlines along with JetBlue have been taking away market share from Spirit in the last 5 years or more.
Her ego is huge
I miss it
She saw the spot beforehand and approved it.
Didn't Burger King buy those 400 restaurants from Carol's to improve them?
They still have one by me. Hitting it up on the way home. Still slaps. But when we get jerseys mikes it’s gonna be hard to stay loyal
jersey mikes is still more pricey, so its still a cheap option
First comment
Hi
Well, they are in the midst of a transformation, given that they have a lot of locations that haven't seen a single refurbishment in years, and because their rivals are bang up to date, CEC are accelerating their 2.0 programme, and it's yielding results. Though 2.0 has its criticisms, chiefly the elimination of the animatronics in all but 5 locations, it does look a lot more contemporary, and CEC are beginning a bigger international expansion, with Kuwait being their latest market, and they're also eyeing Australia, so I think they'll bounce back.
I love all Industry Unfiltered videos!
get the GOV out of the way!!! Marxit goverment wants to control everything? BIDENOMIC working great
yoho yo ho a pirates life for me
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@@industryunfiltered know what cause you asked nicely sure bud
Good job 👍
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Predicted this years ago when all the companies wanted their own services
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Enshittification in action.
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pirate + plex
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Buffets were all but killed off by the Covid-19 Pandemic,only a few are still in business.The either went out of business or converted to full service restaurants.
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piiiiiiiiiiiiiiiracy is cool
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I have been cutting back on the services I am apart of. After this month I will just be down to Amazon Prime. If Amazon keeps turning their store into Wish or Temu then I will drop that. So what am I doing? Simple I am spending thousands in servers (plex) and physical media (to rip) so I don't have to send another $15 a month for content I don't know will be there the next time I log into that service. The whole idea of owning nothing and being happy will come to an end.
Streaming has just become cable with extra steps.
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I have and always will sail the seven seas
met too!!
ARRRGHHHH matey
I live in a 3rd world country and there is no way I can afford 10$ a month for a steaming that doesn't allow me to take screenshots.
I live in a first world country and I can't bring myself to pay for the steaming pile of shit that are contemporary streaming services
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Hulu is literally unwatchable. I literally can’t watch Hulu because the ads are so bad.