New tariffs will create ripple effects across retail—and returns will be no exception.

• With US retail returns predicted to exceed $1 trillion this year, according to a December 2024 EMARKETER forecast, the pressure is on retailers to adapt.
• “We’re seeing massive planning and anticipation, especially among retailers fulfilling product from offshore,” said Robert Johnson, executive vice president of business development at ReturnPro. “Retailers have to pay for every unit entering the country and on the return side, they don’t want to deal with one more cost.”

Here’s how tariffs could impact returns and what retailers can do to prepare.

The end of “keep it” policies

In the past, many retailers tolerated losses from returns, especially on low-cost items. But tariffs may change that, according to Johnson.

• "Keep-it" return policies—where customers receive refunds but keep the product—could lose popularity.
• "When brands implement a keep-it policy, there's no ability to recover that tariff," Johnson said. "They've paid it, and it's done."

Existing challenges like "bracketing" (buying items in multiple sizes/colors and returning extras) and "wardrobing" (returning used items) complicate returns even further.

• Some 38% of US retail executives cite bracketing as their biggest returns concern​, while 35% say the same about wardrobing, according to October 2024 data from Optoro.

The resurgence of resale

While shoppers are stocking up for price hikes, return behaviors haven’t shifted​ yet, according to Johnson.

Resale and secondhand shopping are rising as consumers seek affordable options.

• This could be good news for brands wanting to keep returned items on the market.
• “If you can’t get it back on the shelf as a new product, you can still sell it on the secondhand market,” said Johnson.
• While it probably won’t completely offset the tariff paid, it can help recoup some of the cost.

Being able to get items back on the market quickly is crucial for categories like apparel and consumer electronics, where trends move fast.

“You may have only three or four months to get a product back on the shelf before it loses its value,” said Johnson.

• Third-party partners like ReturnPro can help brands quickly refurbish and restore electronics, increasing their resale value.
• "With 20 minutes of work, you can move a recovered electronic product from 20% value to 90%," Johnson said​.

How to prepare now

Retailers need a new returns playbook. Here’s how to stay ahead:

• Diversify supply chains to reduce exposure to tariff-heavy regions. "Being centralized in one market is a huge risk now," said Johnson.
• Invest in returns technology that streamlines processing and maximizes recovery value.
• Prioritize partnerships, not just vendors. "Find a provider that extends your team," Johnson advised. "In a volatile environment, you need someone who will react and innovate alongside you."

This was originally featured in the Retail Daily newsletter. For more retail insights, statistics, and trends, subscribe here.