The death of free shipping

Well, if you’ve ever bought stuff online and received free shipping or returns, you’ve also been a little bit of a jerk — and now it’s time to pay up.

Fast, free shipping and easy, no-cost returns have become a baseline expectation in the modern online shopping experience. Many consumers have grown accustomed to treating their bedrooms like store dressing rooms, confident they can regularly buy 20 items of clothing, try them on, and then send all but one back, no questions asked. Waiting even two days for a purchase to arrive seems like forever, and anything greater than $0 for shipping is a robbery. A December 2022 survey by the National Retail Federation and Appriss Retail found a 16.5% return rate for that year, estimating $816 billion worth of merchandise would be sent back.

Some consumers have taken free-return policies to such an extreme that they've been barred by various retailers from the online shopping aisle. A recent story in The Cut on the end of the “return grift” reads like “r/AmItheAsshole Greatest Hits: Retail Edition.” One woman who had returned items to Urban Outfitters once a month since high school was given the boot. Another lost her shopping privileges at Saks after she bought — and then returned — $15,000 worth of merchandise. Another was described as “pleading” with ASOS to earn back her right to shop. Her pseudo-crime: returning 99% of the 172 purchases she made in the span of a year.

Are these the greatest transgressions in the world? No. But these shoppers are not tragic victims. The ability to order and return items without spending a dime is not listed as an unalienable right in the Declaration of Independence.

But now the tide is turning — and not just against super-returners. Instead of fighting for market share by offering free shipping and no-hassle returns, retailers are trying to squeeze more money out of every transaction. Retail margins are tighter. The Federal Reserve’s interest-rate hikes mean borrowing money is no longer free for e-commerce companies. And investors want to see actual profits instead of lofty promises.

As a result, a multitude of retailers — including H&M, Zara, J.Crew, and even Amazon — have started to adjust their return policies. They are charging to send stuff back, shortening return deadlines, and refusing to accept some items entirely. Retailers want to dissuade consumers from making returns at all — or at least force them to do it in a more profitable manner, like physically bringing stuff back to stores.

“A lot of retailers are trying to cut back on free returns,” Neil Saunders, a managing director at the retail consultancy GlobalData, told me. “It’s very expensive for a retailer to service that because they are having to pay all of the costs of reverse logistics, and sometimes the products that are returned are not saleable.”

Some companies are also cutting back on shipping perks, either by increasing minimum purchases eligible for no-cost shipping or by upping what they charge for next-day deliveries. It’s harder for retailers to cut back on free shipping than it is on returns because consumers have been accustomed to the belief that everything should arrive as if by magic, free of charge. But they’re on the lookout for every possible way they can squeeze a little more from customers. Not to mention that Amazon Prime now charges a cool $140 a year to get things shipped “free.”

To put it plainly: Retailers spent years getting us addicted to online shopping. And now that we’re hooked, they have more leeway to jack up fees for logistics.

It’s a bummer, of course, to have to pay for stuff that used to cost us nothing. But in a larger sense, the pushback from retailers is a good thing. Free shipping is not actually free. It involves massive, expensive logistics operations and often leaves small retailers at an impossible disadvantage compared with their much larger competitors.

The too-easy shipping and returning process consumers have come to expect is harmful to the environment. It enables a level of careless consumption that makes it easy for people to ignore the physical and financial costs incurred by the workers who get things from point A to point B (and back). We want things fast and free, but we don’t like to think about what’s going on under the hood to make that happen.

Thirty years ago, the idea of having to return an item to the store in person, or to eat the cost of sending something back, wasn’t a big deal. But because we as a species are averse to loss, it now feels painful and unfair. Retailers changed our expectations of getting to return things for free, and now they’re trying to change them again.

Returns are a necessary and inevitable part of online shopping. Who among us hasn’t ordered an item of clothing, only to try it on after it has arrived on our doorstep and think, “Huh?” Disappointment comes with the territory.

Still, most of us could stand to be more thoughtful in our purchases — especially in a world where our unprecedented levels of consumption are such a huge part of what’s making the planet uninhabitable. If making shipping and returning a little less frictionless helps us pause every now and then over the “add to cart” button, maybe that’s not such a terrible trade-off.

Emily Stewart is a senior correspondent at Business Insider, writing about business and the economy.