National Retail Federation: 2023 Retail Consumer Returns Report

The approach to consumer returns in 2023 will be slightly different than in past years. The National Retail Federation (NRF) has partnered with Appriss Retail, which counts 60 of the top 100 retailers in the U.S. as its clients, to pair its customer returns data with NRF’s findings.

This year’s report provides a more nuanced look at the impact of online sales on sales and returns.

In 2023, total merchandise returns in the retail industry will reach $743 billion.

The total return rate as a percentage of sales in 2023 is 14.5%.

In 2023, abuse and fraud will affect 13.7% of total returns.

In 2023, returns losses due to abuse and fraud will total $101 billion.

Merchandise Sales, Returns, Fraud and Abuse

U.S. retail sales to reach $5.13 trillion in 2023

$743 billion in returns accounted for 14.5% of total sales

In-store - Online

Online sales are expected to grow 10%, with total online sales reaching $1.4 trillion.

Online returns are expected to account for 17.6% of total online sales, with total online returns reaching $247 billion.

A new category of online returns is claims and settlements; this is also the fastest growing category and includes return fraud and abuse. When a shopper files a claim, they inform the retailer that the product was not received, was received damaged, or had another type of defect. Many retailers believe that claims and settlements are directly related to return fraud and abuse.

Retailers are also reporting an increase in the misuse of fake online purchase confirmations to commit return fraud in stores, likely due to poor connectivity between systems.

In-store returns were 13.3%, or $495 billion. 49.7% of in-store returns were BORIS or originated from online purchases. As online sales grow, their impact on store returns is also growing.

After excluding BORIS from in-store returns, the net return rate for physical stores is 10.02%, or $373 billion.

As retailers implement no-return policies, fraudsters turn to other tactics, such as fake returns. Retailers need to continue to adapt to these new types of return fraud.

Estimated Holiday Sales, Returns, Fraud and Abuse

US holiday sales in 2023 are expected to be $966 billion. Returns of $148 billion account for 15.4% of total sales.