The National Retail Federation’s 2018 Organized Retail Crime survey was recently released. Analysis of the survey states that overall value of returned merchandise in the United States during the past year was almost $369 billion. This cost does not include the overhead a retailer incurs when receiving, sorting, and repackaging useable goods for resale. In addition, $18 to $24 billion of that sum were fraudulent returns.
Fraudulent returns are not isolated incidents that only impact a few select retailers. The NRF survey shows that 91.6% of all retailers are a victim of illegal returns.
Among the top targets of organized crime rings are apparel retailers. Specifically, the most common types of fraudulent returns come from shoplifting, use of counterfeit currency and wardrobing. All of these illegal return tactics work well for expensive designer clothes and handbags where criminals can make hundreds, if not thousands of dollars per fraudulent return.
The NRF survey included projections for the 2018 Holiday retail season.
“Retailers expect an average of 11.1% of sales to be returned during holidays, with about 10.3% of those returns being fraudulent.”
Now that dealing with returns is a recognized part of doing business, it’s time for retailers to rethink their reverse logistics and supply chain operations, especially when it comes to merchandise that can’t go back on store shelves. Plus, with holiday returns a current reality, now more than ever, retailers need to think about a strategic liquidation solution like the one B-Stock provides.
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