FedEx Expands Boxless Returns to SMBs

FedEx consolidated returns feature

Taking advantage of a growing consumer preference for boxless returns, FedEx is rolling out a consolidated returns program early this year aimed at providing the service for small-to-medium-sized merchants in addition to major retailers.

Under the program, consumers bring a returned item, no box required, to one of 2,000 FedEx Office retail stores. Packages bound for multiple merchants are then consolidated and processed by FedEx Logistics and sent back via less-than-truckload shipments.

According an October survey from Happy Returns, customers rank in person, boxless returns as their number-one preferred method of sending purchases back, even ahead of home pickup. When the dropoff is in a store, 62% of those surveyed say they would use their refund to shop that retailer or a third-party location.

While FedEx has had a relationship with Happy Returns since the fall of 2020, adding its retail stores as dropoff points for the latter’s returns bar network, FedEx provides all the logistics for this new offering.

“As the returns market grows, FedEx continues to explore innovative alternatives for our customers,” said Ryan Kelly, Vice President, Ecommerce and Retail Marketing for FedEx Services in a statement. “While this solution will provide a low-priced returns option for merchants, it’s also a simple, convenient process to help retailers deliver a shopper-friendly experience.”

Rival UPS has had a boxless, dropoff offering at its retail stores for several years, leveraging reverse logistics partners Optoro, Narvar and ReadyCloud, in addition to the standard home pickup option.

The rate of returns from retail purchases is expected to remain relatively flat for 2022 compared to 2021, at 16.5%, with those originating from stores and ecommerce roughly equal as the latter figure has improved, according to a recent report from the National Retail Federation and Apriss Retail.

NRF and Apriss project that $816 billion worth of purchases will be returned in 2022, with the return rate for stores ($603 billion out of $3.66 trillion, or 16.4%) being virtually the same as for online ($212 billion of $1.29 trillion, or 16.5%). In 2021, the ecommerce return rate was 20.8%.