Growing consumer trends will keep ‘returns’ in fashion

Six key consumer trends have been identified as influencing the volume of goods that shoppers buy online and their growing propensity to send a proportion of these back. This can prove challenging for fashion brands and retailers, with the need to continuously improve and optimise supply chains to ensure clothes and accessories are returned quickly, and efficiently processed for resale.

Achieving this can avoid costly out-of-stock scenarios and minimise product wastage. An effective returns process keeps clothes in circulation, maximising availability and selling opportunities. This requires consumer returns to be seamlessly integrated into supply chain management strategies and supporting this with bespoke software that provides complete end-to-end visibility of the movement of products.

Almost six-in-ten retailers expect the volume of returns to increase this year, compared to 2021, with a number of different consumer trends impacting this shopping habit. The importance of returns is highlighted in ASCG’s latest research and its free eBook.

Understanding consumer trends is a crucial starting point for making this possible. By determining how shopping habits will impact returns, retailers can enhance supply chain agility. Three of six key trends identified in ASCG’s latest research include:

1) Spread the cost

The concept of flicking through home catalogues and placing orders via post, or speaking over the phone, will be alien to most of today’s generation of online shoppers. However, they are increasingly familiar with the concept of spreading the cost of payments, which made home-shopping catalogues such a hit in previous decades.

This concept has been digitised, with ‘shop now, pay later’ options like Klarna becoming something of a default purchasing behaviour for a growing share of internet shoppers. This can have huge ramifications for supply chains, as it can make goods with higher retail selling prices more accessible and can change order quantities and purchasing frequencies quite considerably.

The ability to spread and delay the cost of purchases provides shoppers with more flexibility. It creates the opportunity for them to put more items in their online baskets, as they know they have a period of time to consider different options before they make a final decision on what they actually want to buy. Stock inventory management and supply chain strategies need to adapt accordingly to ensure the right products are being stocked at the right times, and at the right prices. Similarly, supply chain software and practices need to be able to provide retailers with accurate, constantly updating information about purchasing habits. This data can enable companies to build more informed stocky inventory models that better predict what goods will move out and back into supply chains.

2) Try before you buy

TheIndustry.fashion and ASCG survey* of 2,000 shoppers in October 2021 found that being able to try items before purchasing was the greatest benefit of high street shopping. Almost two thirds (63%) ranked it their top benefit, above being able to get instant refunds and immediately exchange unwanted items. It’s impossible for store changing rooms to exist online but this isn’t dampening the love of ‘trying before buying’ amongst e-commerce consumers.

Online shoppers feel more and more comfortable buying multiple items, whether that’s different size, colour and style variations of the same clothes or putting ‘alt-products’ in their baskets, which are essentially a back-up choice in case they don’t like what else they’ve ordered. ‘Trying before buying’ will play a big part in contributing towards the growing volume of returns in 2022. Technology must be able to seamlessly integrate returns into supply chains as their own stand-alone channel, with returned products treated much in the same way as goods sold.

3) Low and no-cost

Fashion brands and retailers have long contended with consumer demand for deliveries that are free-of-charge or low cost. This demand extends to returns, with growing expectation that returning items doesn’t cost them anything and is also convenient.

Retailers and brands which make returns free, quick and easy are more likely to reduce barriers to purchase for consumers and avoid abandoned baskets at e-commerce checkouts. However, the benefits don’t stop there. Making returns more consumer-friendly can also help reduce the time it takes for shoppers to actually send back unwanted goods. Minimising the returns lag can mean items are processed more quickly for resale, making optimum selling prices more of a reality.

It's increasingly important for fashion brands and retailers to consider the value of the low and no-cost trend as they address margin dilution in supply chains. Rather than attempting to protect margins by charging for returns or reducing delivery and return options, it’s possible to find other efficiencies throughout supply chains. Having a control tower view of the movement of goods and rich data about the performance of returns can make savings more accessible.

For example, with the right information, retailers can optimise transportation space and the movement of products to reduce carbon emissions and identify efficiencies that lower energy consumption and minimise errors and product wastage.

ASCG’s eBook covers more trends and also looks at the three key actions retailers can take to optimise stock inventory management and supply chain strategies in 2022, and beyond. Click here to download a free copy.

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* EXCLUSIVE REPORT: Reshopping “Returns, Refunds and Respending” -  How streamlining returns and refunds will help drive future sales and long-term loyalty: download here.