Retail Returns: Why Making Them Harder Hurts Business 2026

Retail returns are becoming more difficult for consumers, and that's a costly mistake for businesses. In my 30-plus years as an accountant, I've learned many business lessons from people much smarter than me. Jerry Crawford was one of those people. Jerry taught me about product returns.

Jerry – who sadly passed away a decade ago – sold carpets wholesale from a nondescript little building in south Jersey. He employed about 50 people and counted many local and national carpet retailers as his customers. When I reviewed Jerry's books, I noticed a large reserve for "returns".

"They're a part of every business," he told me. A "reserve" is something businesses create for potential future costs. Some reserve for bad debts. Others reserve for inventory that grows old and will need to be disposed of. And plenty of businesses – like Jerry's – reserve for the potential costs that will be incurred if a customer returns their product.

Why Retail Returns Are a Normal Part of Business

Returns are just a normal part of business. Plenty of small business owners like Jerry go to great lengths to make the process as easy as possible. Some big companies, such as Amazon, do the same. "There's a cost to do this," Jerry said. "So I make sure to build a reserve for that cost."

Makes sense. And yet, it seems that many businesses still haven't learned this lesson. According to the Wall Street Journal, many Americans are complaining that it's getting harder to return things. They're seeing surprise fees, shorter return windows and more restrictive policies.

This trend is a mistake. Here's why.

The Hidden Costs of Making Returns Harder

When retailers make returns harder, they might save on short-term costs, but they incur long-term damage. Customers who face hurdles are less likely to shop again. They tell friends and family. They leave negative reviews. The lifetime value of a customer plummets.

In contrast, easy returns build trust. They encourage purchases. They reduce the risk for the buyer. And they often lead to repeat business. A study by the National Retail Federation found that 96% of shoppers would shop again at a retailer that offers a convenient return experience.

Data: The Impact of Return Policies

As the table shows, making returns harder may reduce immediate costs but severely damages customer loyalty and future revenue.

Key Takeaways for Retailers

• Returns are a cost of doing business – plan for them with a reserve, like Jerry did.
• Easy returns increase customer lifetime value – they build trust and encourage repeat purchases.
• Short-term savings from restrictive policies often backfire – you lose more in future sales than you save.
• Transparency is key – surprise fees and hidden conditions anger customers.
• Follow the leaders – Amazon and other successful retailers prioritize hassle-free returns.

FAQ

Jerry Crawford understood that returns are inevitable. By embracing them and making the process easy, he built a successful business. Retailers today should heed that lesson. Making returns harder is a mistake that hurts both customers and the bottom line.

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