What Do Stores Do With Returned Clothing?

Last Updated on January 22, 2024

Online shopping has certainly made our lives easier, but this convenience comes at the price of returns. Product returns are costly on our wallets and the environment — a fact purposely swept under the rug by retailers.

The Point of No Return 

In the retail business, returns are referred to as “reverse logistics,” and the open secret is that most companies don’t have a good handle on what to do with all of these products once consumers decide they don’t want them. According to a 2021 article by Amanda Mull in The Atlantic, while retail stores have return rates in the single digits, online retailers can have return rates anywhere between 15 and 30 percent. This rate is on the higher side for clothing retailers because of a term Mull refers to as “bracketing” — the practice of consumers buying one size larger and one size smaller than their typical size to check for the best fit. 

The reliance on returns is what we could call the “Zappos effect.” In her article, Mull relays the early success Zappos had in enticing consumers to buy an item that is notoriously difficult to buy online by offering free shipping, free returns, and a “the customer is always right” attitude. The company experienced such exponential growth that it could afford this business model, and soon, other companies followed suit until it became standard practice. By constantly offering free shipping, free returns, and regular discounts, which are actually just baked into the retail price of the item, companies set up a system that incentivizes consumers to return products. 

However, now companies have dug themselves into a hole that they can’t get out of. Recently, The New York Times wrote about liquidation warehouses that started springing up in late 2021. Due to the pandemic, companies such as Target, Walmart, and Amazon experienced skyrocketing sales, since people spent money on goods rather than services. With supply chain issues leading to empty shelves, companies ordered products months in advance to try to keep up with demand. And then the demand suddenly dropped due to inflation, leading to warehouses of goods being sold at a loss. Add that to record-high losses due to returns — with record sales comes record returns — and there is simply too much junk out there for any major company to know what to do with. 

Burn Baby Burn 

While some of these products end up at liquidators like the one profiled in The New York Times, many products end up being simply burned or destroyed. Companies such as Burberry, H&M, Nike, Urban Outfitters, and countless others burn billions of dollars of brand-new merchandise every year.

It is impossible to know exactly how much merchandise is disposed of, as the supply chains are so complex they are almost impossible to trace, but Mull states that it is estimated by industry insiders to be around 25 percent of all returned goods. So, roughly one out of four of the items you have returned to an online retailer have ended up being incinerated or thrown into a landfill. While this is an issue that should be regulated on a government level, the number of returns we make as consumers is something that we have power over. 

Tips on How to Reduce Returns

1. Buy secondhand when possible. Buying an item secondhand keeps clothing out of landfills. Explore thrift stores or sites like Poshmark or Depop before buying something new. 
2. Consider trying on items in person. If you are near a physical store location, visit in person so you can try on different sizes at one time. 
3. Even if you buy online, return in person if you can. Returns made in person are more likely to actually end up back on the shelf. 
4. Don’t buy multiple sizes of the same item. While buying more than one size when online shopping is convenient, it means you are guaranteed to make a return, and that return does not just “go back on the shelf.” Take detailed notes of your body measurements and compare them to the brand’s size chart. Read reviews to see if an item runs true to size or not. You can even email customer service for advice on what size to get if you are still unsure. If you increase the chance that you get it right the first time, you can decrease the chance of a return. 
5. Revisit brands you know.  While it can be fun to explore new designers, if you know a brand tends to fit you well and makes good-quality clothing, it is a safer bet than one you haven’t tried before. 
6. Shop smaller brands. Indie designers and small brands are less likely to be able to afford the high cost of tossing returns and are incentivized to resell inventory. 
7. Buy two of something you love and wear often. Do you find yourself always wearing the same pair of jeans or shoes over and over again? Consider buying a second pair, and better yet, buy them lightly used. Styles are discontinued all the time, so you will save yourself the need to search for their replacement in the long run. Further, owning two of the same item actually makes your items last more than twice as long, since recovery time between wears extends the overall lifespan of your items.