How retailers like Best Buy, T.J. Maxx and Home Depot quietly target ‘problem’ returners

It’s
no
secret
that
retailers
are
cracking
down
on
returns.

In
2023,

81%
of
U.S.
retailers
implemented
pay-to-return
policies
in
some
capacity.

Amazon,

Macy’s,

T.J.Maxx,
Walmart
and
Staples
all
rolled
out
changes
to
their
established
return
policies.
That
may
look
like
shrinking
return
windows,
charging
for
some
returns,
or
in
some
cases
simply
telling
shoppers
to
“keep
it“

Shoppers
racked
up
more
than
$5
trillion
worth
of
retail
sales
in
the
U.S.
last
year,
according
to
the

National
Retail
Federation.
About
14.5%
of
those
sales
were
returned.
That
equates
to
an
enormous
value
in
returned
goods:
$743
billion
in
2023
alone.

“Most
of
the
returns
that
come
back
cost
up
to
40%
of
the
original
retail
price
to
put
that
item
back
on
the
shelf,”
said
Robert
Overstreet,
Iowa
State
assistant
professor
of
supply
chain
management. “There’s
no
guarantee
they
can
sell
it
for
what
they
originally
asked
for
it,
so
they’re
losing
money
on
both
ends.”

The
recent
changes
are
just
the
latest
effort
to
tamp
down
on
return
losses.
Many
large
retailers
in
the
U.S.
have
long
been
engaged
in
the
practice
of
quietly
tracking
and
targeting
return
behavior.
According
to
a
report
by

The
Wall
Street
Journal,
U.S.
retailers
use
third-party
loss-prevention
services
to
track
risky
return
behavior.
This
doesn’t
outright
mean
fraudulent
activity,
but
rather
behavior
that “mimics”
or
could
be
linked
to
such
behavior.

The
most
notable
third-party
loss-prevention
service
is

The
Retail
Equation,
a
software
provider
that
tracks
return
behavior
that
retailers
deem
potentially
fraudulent.
It
then
assigns
a
return
score
to
shoppers
based
on
the
data
provided
by
retailers,
giving
the
software
the
ability
to
override
a
store’s
return
policy,
leaving
shoppers
with
no
refund
and
a
printed
notice
directing
them
to
The
Retail
Equation’s
website
to
explain
why
their
return
was
blocked.

The
problem
is,
many
shoppers
are
unaware
this
type
of
tracking
is
even
happening,
leaving
many
feeling
blindsided
when
they
get
to
a
return
counter
and
are
told
they
are
not
getting
their
money
back.
Or,
even
worse,
they
get
banned
from
the
practice
of
returning
products
to
the
store
altogether.

According
to
several
now-dismissed

lawsuits
and

Better
Business
Bureau
complaints,
customers
reported
they
were
following
a
store’s
return
policy
and
were
still
issued
a
warning.
Some
customers
complained
the
information
found
on
their
report
given
by
The
Retail
Equation
was
incorrect
and
that
they
were
left
with
no
way
of
knowing
or
remedying
the
information
until
after
their
return
was
rebuffed.

Watch
the
video
above
to
hear
more
about
how
this
tracking
works
and
what
types
of
behaviors
might
get
a
shopper
flagged
as
a ‘problem
returner’.

Clarification:
Best
Buy
ended
its
relationship
with
The
Retail
Equation
in
2019,
according
to
the
company.