Why Retailers Should Prioritize Reverse Logistics

uring the holiday season, the spotlight often shines on the surge in online orders, the rush of Black Friday deals, and the thrill of hitting record sales. Yet, for many retailers, the post-holiday period can be equally challenging. Returns spike, customer expectations remain high, and operational pressure intensifies. Retailers estimate that 15.8% of their annual sales will be returned this year, totaling $849.9 billion, according to the “2025 Retail Returns Landscape” report released by the National Retail Federation and Happy Returns. As more people turn to online shopping, reverse logistics is becoming a strategic priority for many retailers.

Unlike forward logistics (which focuses on getting products to consumers), reverse logistics deals with what happens afterward: returning, reselling, recycling, or disposing of items. As eCommerce continues to grow, efficiently managing reverse logistics has become essential for protecting margins and strengthening customer loyalty and sustainability efforts, especially in the weeks and months following the holiday season.

Here’s a look at how prioritizing reverse logistics can benefit retailers during the post-holiday returns surge and after it subsides.

Rising holiday returns are putting pressure on reverse logistics networks and cutting into profits. Consumers expect free returns as part of the online shopping experience. But tariffs, economic uncertainty, and rising costs are forcing retailers to rethink that model. Return fraud has also become more common, putting pressure on retailers’ margins. Three-quarters of retailers say return fraud worsens during the holidays, according to ReturnPro’s new Holiday Returns Report. 

Two-thirds of retailers are implementing measures to monitor or prohibit excessive return patterns this holiday season. These include offering free in-store returns, using technology to improve product accuracy at purchase, and limiting free shipping to loyalty members. Retailers are increasingly using automation, AI-driven routing, and centralized return hubs to optimize their reverse logistics networks, minimize costs, and streamline return processing. Shortening return windows, restocking fees, or limiting the number of free returns can also help offset mounting operational expenses while encouraging shoppers to make more deliberate purchasing decisions.

A smooth, hassle-free and transparent return process can strengthen customer loyalty, while a confusing or slow return process can drive customers away. Sixty percent of shoppers are unlikely to keep buying from a brand if its return policy is frustrating or confusing, according to a survey from Akeneo. Retailers that simplify returns by offering prepaid return shipping labels, multiple drop-off options, and real-time tracking can turn a potentially negative experience into a loyalty-building opportunity. 

Retailers have transformed their physical locations into mini return hubs. By accepting online returns in-store, they not only reduce shipping costs but also increase opportunities for upselling or cross-selling during the visit. The return interaction also presents a powerful opportunity for retailers and brands to personalize engagement. Using CRM and order history data, retailers can tailor post-purchase messaging, suggesting replacement products, issuing loyalty points, or offering targeted promotions based on the customer’s preferences.

Consumers are increasingly conscious of the environmental impact of returns. Sixty-eight percent of shoppers said they understand the environmental toll of returns, and 39% said sustainability plays a role in their return decisions, according to Akeneo’s survey. Rather than discarding returned goods, companies can repair, refurbish, or recycle them, reducing waste and carbon emissions. 

For example, apparel brands can resell gently used items through outlet or resale channels, while electronics manufacturers can refurbish and resell devices at discounted rates. Delivery trucks and vans transporting products back and forth generate a significant carbon footprint. However, consolidating return shipments and optimizing return routes can help companies reduce fuel consumption and emissions.

After the holiday rush, retailers must handle enormous reverse logistics volumes in a short timeframe. Effectively managing this process helps companies transform what could be a costly operational burden into opportunities for customer retention, operational optimization, and sustainability improvements.

For more information about how our delivery management solution can help you manage your delivery operations more efficiently, please contact info@bringoz.com.