One of the biggest pain points is the increasing cost of logistics—more expensive transportation, higher warehousing expenses, and strained delivery networks are all impacting margins. As a result, return logistics costs are coming under greater scrutiny—an area that still holds untapped potential for improvement.

According to a study by EHI, 60% of surveyed retailers face return costs ranging between five and fifty euros per return. At the same time, customers continue to expect this service to be free. This gap between consumer expectations and economic realities is forcing companies to explore new paths and develop innovative solutions. Flexible processes that respond to customer needs while optimizing operational costs are now a critical success factor.

Where Are the Pain Points—For Customers and Retailers?

Return management has become increasingly complex in recent years. Many consumers now order multiple items with the intention of deciding what to keep once the products arrive at home. This behavior naturally leads to higher return rates and, along with the general growth of e-commerce, contributes to an overall increase in returns. The proliferation of sales channels—such as social commerce, marketplaces like Amazon, and dedicated D2C channels—adds another layer of complexity. The more channels a retailer uses, the harder it becomes to maintain a unified returns process without innovative solutions.

The challenge lies in balancing economic efficiency with customer satisfaction. While Zalando helped establish the norm of free returns, Amazon has taken consumer expectations even further—allowing returns at almost any time and in any condition. However, with general price increases, logistics costs are now rising significantly. For retailers, maintaining profitability without alienating customers has become a balancing act—especially as even major players like Amazon are now tightening their return policies.

Getting Returns Right: Strategy Is Everything

Return management isn’t about one-off initiatives. It’s about the coordinated use of various micro-strategies that align with the core business strategy while reinforcing customer trust. Companies that continuously work on their return processes and implement innovative solutions across the entire post-purchase journey are able to reduce the cost of this critical area.

The tension between rising post-purchase costs and maintaining customer satisfaction is nothing new. However, the price hikes of recent years have intensified the very dynamics that threaten margins. Retailers, for example, are feeling the strain of extended return processing times through increased warehousing costs.

To reduce the rising costs of returns and maintain profitability, retailers must act strategically and optimize their return workflows. Automation can play a major role here. Still, there is no one-size-fits-all solution. Depending on the industry, customer base, and internal logistics infrastructure, the effects of price increases and shifts in consumer behavior manifest differently.

Retailers need to zoom out and take a strategic approach rather than reacting impulsively. One example is the introduction of alternative compensation models for customers, which could help lower return rates over the long term. However, these alternatives need to be well communicated and guided to ensure customer acceptance in the short to medium term.

Communication Is Key

In today’s environment, both small and large businesses must find innovative solutions that align with their strategic goals and reveal potential for savings. Long-term success depends on adaptability, strong customer communication, and the ability to act strategically. Only by developing efficient return processes and optimizing cost structures can companies safeguard their competitiveness and minimize financial strain. Striking the right balance between economic action and customer satisfaction remains crucial—and communicating and explaining new processes to customers plays a pivotal role in this.

With the diversification of e-commerce channels and corresponding adjustments to post-purchase services, retailers have an ideal opportunity to communicate these changes. This may ultimately disrupt the status quo of return management and introduce today’s consumers to meaningful alternatives to the once-standard practice of universally free returns.