Those Amazon returns? They're killing the planet.

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This was published 4 years ago

Opinion

Those Amazon returns? They're killing the planet.

By Adam Minter

In December, consumers will return millions of packages to e-commerce retailers each day. It's a flood of unwanted stuff that's expected to peak on January 2, which delivery service UPS cheekily calls 'National Returns Day".

For UPS and other shippers, that's reason for plenty of post-Christmas cheer. For everyone else, those tens of millions of packages are a real problem. By one recent estimate, they accounted for 5 billion pounds of landfilled waste in the US alone and an additional 15 million tonnes of carbon emitted into the atmosphere.

At a time when consumers and companies are otherwise rethinking consumption choices in light of climate change, e-commerce returns amount to a hidden environmental crisis.

The flood of online shopping returns is fuelling a hidden environmental crisis.

The flood of online shopping returns is fuelling a hidden environmental crisis.Credit: Bloomberg

Of course, the "money-back guarantee" is likely as old as retail itself, and many storied brands built their reputations by honouring it. The benefits don't just accrue to consumers; a retailer that stands by its products likely sells more of them.

Outdoor goods company L.L. Bean offered a lifetime return policy for more than a century, and prospered because of it. Likewise, recent studies of e-commerce suggest that lenient return policies correlate with more returns and an increase in purchases. As far back as 2010, shoe retailer Zappos.com bragged that its best customers were the ones who returned the most products.

The problem is that consumers are returning more and more every year. In 2018, Americans sent back 10 per cent of their purchases, valued at $US369 billion ($538 billion), up from 8 per cent two years earlier. Younger shoppers in particular are more inclined to treat online purchases as rentals, or to buy clothing to try on, then return what doesn't fit or look good.

It's a global trend: in countries like Sweden, return rates are as high as 60 per cent for some products.

The logistical burden of these returns is so heavy it's inspired an entire industry devoted to dealing with unwanted stuff. But the environmental toll may prove to be more significant.

In 2017, Optoro - a company that helps retailers manage their returns - estimated that only 10 per cent of the merchandise it handles ends up back on the shelves. Some is sold on to discounters and recyclers, or routed to charities. But the high cost of transporting, sorting, and repackaging those goods also ensures that billions of pounds of returns end up in landfills and incinerators.

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Making matters worse, getting those products from a dissatisfied customer's home to wherever they'll end up is a carbon-heavy process. And because e-commerce products are returned at a much higher rate than traditional ones, emissions exceed what they'd be at brick-and-mortar outlets. By one accounting, 165 billion packages were shipped in the US alone last year - using cardboard from about 1 billion trees.

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Even as companies like Amazon transition to more sustainable packaging, returns will continue adding to their resource usage.

It won't be easy to convince consumers or retailers to curb these practices. The most obvious solution - a ban on free returns - would understandably meet stiff opposition. But a few other steps might help. Companies could adopt carbon-emission labelling on return packages for instance, or stop providing ready-made return labels altogether, which would easily eliminate the use of millions of pieces of paper.

They could also experiment with 'returnless refunds' for products that can't be sold again, such as under-garments, cosmetics, and packaged foods. As augmented reality and touch-oriented technologies become more common and affordable, online apparel retailers could deploy them in "digital dressing rooms."

So long as there are shoppers, of course, there will be returns. But with a little added effort from retailers and consumers - and perhaps some ingenuity - they can be friendlier to the bottom line and the planet both.

Adam Minter is a Bloomberg columnist. He is the author of Junkyard planet: Travels in the billion-dollar trash trade and the forthcoming Secondhand: Travels in the new global garage sale.

Bloomberg

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