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How Holiday Returns are Handled

Dec 10, 2019 12:15:00 PM

January and December are busy months for carriers who must return all the Christmas gifts that didn't go as planned. Here’s how the situation looks for them and how shippers can expect to be affected.

Christmas is just around the corner, and 2020 isn’t far behind. Carriers have their work cut out for them in both cases. USPS alone is estimating the delivery of 800 million packages between Thanksgiving and New Year’s Day. Some surveys say that 28 percent of holiday gifts will be returned, making the first month of 2020 anything but business as usual for FedEx, UPS and other transportation companies.

The traditional rates and dates of shipped gift returns are changing due to e-commerce. UPS reports that while 1.3 million packages were returned on January 3, 2018, even more were returned in the previous month — 1.5 million packages had to be sent back on December 19, 2018. In fact, so many packages are now being returned by mail that UPS annually dubs the day the most packages are returned as “National Returns Day,” and it expects this holiday season to set a new record with 1.9 million packages returned on January 2, 2020.

This represents a great increase in workload for the big carriers. How can you expect that to impact your packages and customers?

How are millions of return packages handled?

To have any hope of handling such a rate of returns, even the big carriers need extra hands. FedEx has announced plans to add 55,000 seasonal workers to its FedEx Ground network to support around 450,000 employees already in place.

UPS plans to hire nearly double the FedEx figure, with an extra 100,000 seasonal hands standing by to process returns. That’s a lot of old and new employees who’ll need to be paid this holiday season and, one way or another, shippers will feel the sting of returns in their shipping invoices. For example, FedEx’s conditions of carriage state they “shall be entitled to charge an administrative fee for packages rejected and for the costs of returning goods, where applicable, to the Sender.”

A mistyped address by your shipping department is one typical reason packages may be returned to sender, but FedEx may try to save you return costs by making an address correction — for a fee, of course. This could be $16 per correction for most FedEx services, $84 for express freight services or up to $112 per shipment according to page 2 of the FedEx Fees and Other Shipping Information.

Don’t forget to factor in the FedEx fuel surcharge If they must return goods to you.

UPS says they’ll allow you or your customers to return goods “for a nominal fee” via the CampusShip option (the fee isn’t advertised). UPS also offers the Returns Plus service where shippers can request either one or three pickup attempts for the return of a package. Shippers hoping to make the first attempt a successful one are encouraged to use UPS’ Quantum View Notify service which at least is free of charge.

Returns are just one problem shippers must prepare for during this time of year. The sheer volume increase in shipments means that package loss and damage will spike, too. Altogether, U.S. returns delivery costs are expected to hit $550 billion by 2020 and 71lbs wants our customers to feel as little of that pain as possible.

How 71lbs can help with holiday returns

You may not be able to prevent a buyer (or gift recipient) from changing their mind, but you can keep tabs on your carrier to make sure that customer caprice is the only legitimate reason you’re paying for a return. The 71lbs solution to lost and damaged items can help your business recover its shipping costs if a package returns due to harm. Our simple and unconditional shipping insurance is another great gift to give yourself this holiday season to further protect against hectic handling rates at FedEx, UPS, USPS and DHL.

This is the season when every business stands to make more money than any other time of year, but also lose more if their shipping logistics aren’t optimized. We can tell you about 5000 businesses who won’t have that problem this year, and we’d love to help take the weight of your own shipping operations. Connect with us at the link below and let’s make 2020 your most cost-effective shipping year yet.

At 71lbs, we focus on two things: a) helping customers save money on shipping, and b) helping customers understand their shipping costs. We provide you refunds and savings on shipping insurance, freight and imports, among other expenses. Our automated dashboard displays easy-to-understand shipping costs and insights so you can make better business decisions. Drop by the contact page to get in touch!

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