When should retailers charge for returns?
By Frida Wikingsson, Product Manager, nShift
Free returns still matter to UK shoppers, but they do not expect every return to be treated the same.
Peak trading plans are being signed off now, and returns policy needs to be part of them. Shoppers look at it before buying: in The Ecommerce Returns Opportunity, research IMRG published with nShift in July, 85.6% of 1,000 UK consumers said a retailer’s returns policy is important when deciding whether to buy online.
For retailers weighing up fees, the question is: which returns should carry a charge, and which should not?
Shoppers distinguish between different kinds of return
Shoppers still value free returns. In the IMRG survey, 48.3% of consumers rated them very important when choosing where to shop, and a further 37.4% called them quite important.
But the same shoppers draw clear distinctions between return scenarios. 47.6% think a fee is fair for frequent returners, 26.2% for international orders and 25.8% for items that are not faulty. Only 21.5% say charging for returns is never fair.
Shoppers are more accepting of a charge when they recognise the reason for it.
Blanket fees put loyalty at risk
A flat fee is simple to explain and administer, but it treats very different customers the same: the shopper returning one item because the size was wrong and the customer who routinely orders several sizes and keeps one. Shoppers notice. 26.3% of UK consumers actively avoid retailers that charge for returns, and a further 40.9% are less likely to shop with them.
A poor returns experience can also cost the next purchase. 42.3% of the consumers IMRG surveyed said a poor returns experience would leave them much less inclined to shop with that retailer again, and 28.8% would stop altogether. That lost repeat purchase will not appear next to the fee income in a returns report, which can make a blanket charge look more profitable than it is.
Match the fee to the reason
Instead of one rule for every return, retailers can set different rules for situations shoppers already see differently. In practice:
- Faulty items: keep them free. In the UK, the law settles this one. Under the Consumer Rights Act, retailers must cover the reasonable cost of returning rejected faulty goods, so a fee should never be deducted from that refund. Asking the customer to choose between “unwanted” and “faulty” at the start of the return keeps the two paths separate.
- Frequent returners: charge consistently. This is the scenario shoppers accept most readily. The rule needs reliable return history behind it, so the same customer behaviour always leads to the same fee.
- International returns: use a separate rate. Cross-border returns cost more to bring back, and 26.2% of shoppers already consider a charge fair in this situation.
- Exchanges: waive the fee.1% of consumers would be likely or very likely to accept an exchange offered at the point of return instead of a refund, and fit is the most common return reason at 57.6%. Removing the fee when a shopper chooses another size can keep the sale.
- In-store returns: keep them free where possible. More than 70% of consumers would be likely or very likely to return an online purchase in store rather than by post if the option existed. Hunkemöller, which runs its returns on nShift, has seen a 15% shift from return-to-warehouse to in-store returns since going live. Each of those visits also brings the customer back into the store.
- Larger baskets: consider a free-returns threshold. A basket-value rule can protect margin on smaller orders while making a higher-value basket more attractive.
If I could change only one rule before peak, I would start with exchanges. Fit is the most common return reason, so waiving the fee when a shopper changes size solves the problem without giving up the sale.
Running several rules at once, particularly across markets, is hard to do manually. The return flow needs to read the order and apply the right fee and window automatically; otherwise support teams end up interpreting policy case by case at the busiest time of year.
Set peak-season windows now
Peak often means longer return windows, especially around gifting. If you plan to extend yours, define the dates before the busiest orders start arriving rather than changing the policy mid-season.
The statutory minimum in the UK is 14 days to cancel a distance purchase and a further 14 days to send the item back. Anything longer is a commercial choice. Decide which order dates qualify, when the extension ends and whether your fee rules stay the same during the longer window. Clear dates are easier to explain to shoppers and straightforward to switch off once peak is over.
Put the policy where shoppers will see it
Customers should not discover a return fee after they have paid. The Consumer Contracts Regulations require retailers to tell customers who pays return costs before the purchase, and since April 2025 the Competition and Markets Authority can fine businesses directly for consumer-law breaches, up to 10% of global turnover. The CMA treats cancellation information as material information, so burying a fee in the terms creates regulatory as well as commercial risk. Our UK returns policy guide sets out what the law requires and what it leaves to the retailer.
Once the customer starts a return, speed matters too. 47.4% expect the process to take one to three minutes. If the portal can read the order and show the correct fee and return window immediately, the customer gets an answer without needing to contact support.
Make the policy executable
At nShift, this is why we added a rule engine to nShift Returns in September. Retailers can set fees and return, claim and exchange periods by order, market and return flow. The portal applies the relevant rule when the customer registers the return, so the operational policy matches what the shopper was told before buying. Find out more about nShift Returns here.
Before peak, test the whole journey
Write down which returns are free, which carry a fee and why, and how long each window runs. Then test the journey from checkout through the returns page to the portal. The wording should agree at each point. Our summary of the IMRG research findings covers the parts that shape a returns policy.
…………………………………………….
Frida Wikingsson is Product Manager for nShift Returns, where she leads the product roadmap for return fees, return windows and the tools used by warehouse and support teams.
