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Returns madness in Germany: what happens when you return a package

2022-05-25T17:24:32.063Z

Unpacked, looked at, sent back: Almost every second piece of clothing bought online is returned. We show how complex it is, who earns from it and what you could do about it.



AreaRead the video transcript expand here

Leonie Voss, DER SPIEGEL


»It really is like this in many kiosks, shops and parcel shops - the parcels are stacked up to the ceiling.

And a lot of that is returns.


This film is about how dirty this business can be in the truest sense of the word, how big fashion companies like Zalando are fueling it, and what the world's largest returns experiment reveals about why fewer returns would actually be a win for everyone. «

Briefly on the dimension of the problem: In 2020, 315 million parcels were on the road in Germany - just to return goods ordered online.

To put it in concrete terms: If you were to stack all these packages on top of each other, you would end up with a tower 40,000 kilometers high.

That's a hundred times higher than the ISS orbits overhead.

To get a feel for this, a counter runs throughout the film, showing how many returns are currently on the way in Germany during our report.

By the way, the majority of returns are clothing.

Almost every other part is returned.

And we ask ourselves: does it really have to be?

Or can returns also be avoided?

What happens if we send back a pair of jeans, for example, can we take a look at Fashion Logistics in Ibbenbüren?

Since online trading has been booming, the Stalljohann family business has been growing rapidly.

This is where the decision is made as to what happens to the return.

Linda shows us what it takes to get a returned garment ready for sale again.

Spoiler: It goes through quite a few hands and sometimes even that doesn't help anymore.

Linda Stalljohann, authorized signatory Fashion Logistics


»

She decides now and checks: If the part is OK from the start, then she leaves it as A-goods.

Then it's almost only for separate packaging, so that it's neatly in the bag again.

But of course, if she finds an error, then she decides what kind of processing is necessary.«

Leonie Voss, DER SPIEGEL


"

So accuracy is required here?"

Linda Stalljohann, General Manager Fashion Logistics


»Exactly, a good, trained eye is required here so that even the smallest mistake can be spotted.«

Around 250,000 parts pass through the hands of employees here every month - on behalf of online retailers.

Fashion Logistics has specialized in the processing of clothes, because many returns have defects after trying them on at home: wrinkles caused by transport, make-up residues or stains, as with this sneaker.

Leonie Voss, DER SPIEGEL


»

I can search again.

So I don't see anything here for now.

Okay, that might have happened trying it on, right?

Linda Stalljohann, authorized signatory Fashion Logistics


"

It could have happened when trying on that the customer slipped his socks into the shoes."

Leonie Voss, DER SPIEGEL


»And how is it cleaned?

What is that solution?'

Linda Stalljohann, authorized signatory Fashion Logistics


»Exactly, here we have special cleaning agents again.

The cleaning agent is more or less shot out of the gun – and the stain is removed as a result.«

Leonie Voss, DER SPIEGEL


"

Madness."

Linda Stalljohann, General Manager Fashion Logistics


»The compressed air just dries it so that... Moisture would cause mold to grow again, for example.

That's why we have to make sure it's dry, then it can be packaged again.

Leonie Voss, DER SPIEGEL


"Feels good."

A minute and a half of special treatment and the shoe is like new.

These parts probably didn't stand the shipping well.

Leonie Voss, DER SPIEGEL


"Well, this is pretty wrinkled now."

Linda Stalljohann, authorized signatory Fashion Logistics


»Exactly, we just saw the part upstairs in the returns processing.

That was sort of ejected because of all the folds.

And when that's ironed properly again, then...

Leonie Voss, DER SPIEGEL


»So let's take a look at the ironing street?

Something like that would be handy for the home.”

Linda Stalljohann, authorized signatory Fashion Logistics


"That would be great."

Leonie Voss, DER SPIEGEL


»Ah, there it is.

That didn't even take a minute."

Linda Stalljohann, Authorized Signatory Fashion Logistics


"Exactly, we already have our part here, which is definitely better than the before and after result."

Leonie Voss, DER SPIEGEL


Looks good.

It's still a bit wrinkled on the arms, isn't it?

That's how it works, you can understand it like that, right?

Linda Stalljohann, authorized signatory Fashion Logistics


"I think if you pack it up like this, the customer won't notice that it's already been in circulation."

This blouse can now be folded, bagged and sent as A-goods, i.e. new goods.

According to Fashion Logistics, 95 percent of the clothing can be recycled.


B-stock has minor flaws.

These things come in outlet centers or are sold at reduced prices.


C-ware is no longer good enough for this either.

If it is not taken abroad by residual stock buyers, the material is recycled.


D-ware, on the other hand, is completely useless.

Linda Stalljohann and her team can no longer save around two percent of the items, they must be destroyed.

And the condition in which some of these items of clothing arrive here surprised us quite a bit.

Leonie Voss, DER SPIEGEL


"

What was that smell?"

Linda Stalljohann, Head of Fashion Logistics


"

Yes, I thought so too."

But more on that later.

Let's first look at the counter reading: 3,400 parcels have been returned in Germany since the beginning of this report.

Leonie Voss, DER SPIEGEL


»The misconception is that returns are free on paper, but in reality everyone involved pays.«

Researchers have found that if you take all returns, regardless of whether they are clothing or electronic devices, it costs the company an average of just under 20 euros per shipment - including for transport, reprocessing, possible loss of value and storage of the item.

The environment also suffers.

In 2018 alone, emissions from returns amounted to 238,000 tons of CO₂ equivalents.

That would be 125,000 car journeys from Hamburg to Cape Town.

Leonie Voss, DER SPIEGEL


"And we're going to take a closer look at how much time customers spend in their lives sending back unwanted clothing, because it's a much bigger time waster than we previously thought."

But first we'll take a look at how it works in the best case, i.e. how you manage to order clothes that you don't have to send back.

And artificial intelligence should help with that.

Online shops compare the body measurements and shopping experiences of millions of customers.

This should make it easier to determine the correct size immediately.

Leonie Voss, DER SPIEGEL


“We're testing it today – with my colleague Fabian.

He is particularly tall, 2.04 meters, and told us that he always has trouble shopping for clothes online.

And that's why we're doing a little experiment today.

We order clothes using the Fit Finder.

This is a digital size advisor that many brands are already using.

Fabian, how about you: how do you shop for clothes online?”

Fabian Pieper, DER SPIEGEL


»I have three or four brands that fit.

Sometimes I order them in the Netherlands for extra tall, slim men, you can get clothes like this T-shirt there, I can't get something like that off the shelf.

And I would be happy if there was an opportunity to try out other brands as well.«

Leonie Voss, DER SPIEGEL


"Then let's try it out!"

Fabian Pieper, DER SPIEGEL


»To increase the chance that something fits, I would try this Tommy Hilfiger shirt.

It says available in many sizes.

It's not really my style, but give it a try.«

Leonie Voss, DER SPIEGEL


"Yes, it can't hurt to have such a classic shirt."

Fabian Pieper, DER SPIEGEL


"I'm happy about every piece of clothing that fits in the end."

Leonie Voss, DER SPIEGEL


»Ah, unsure about the size?

Here comes the size guide, let's play through it.

Now we have to enter here: your height.«

Fabian Pieper, DER SPIEGEL


»I am 2.04 m and weigh 100 kilos.

I weighed that extra.

«

Leonie Voss, DER SPIEGEL


»

Now there is a size recommendation and he says: Based on thousands of purchases by similar people, there is an 81 percent chance that you will be satisfied with size XXL.

«

Fabian Pieper, DER SPIEGEL


»

I hope it fits.

«

Leonie Voss, DER SPIEGEL


»

Then we'll pay and meet again when the packages have arrived.

«

Behind the Fit Finder is the Berlin company Fit Analytics, market leader in the field of size advice.

Many well-known labels use the tool.

But how does the start-up's algorithm work?

Sebastian Schulze, CEO Fit Analytics


»You can imagine it like this: If you enter your height, weight and age yourself, then we look for people who have used the size advisor in the past.«

Doubles are thus identified in practice.

In the case of my colleague Fabian, people who stated very similar body measurements and who have already ordered exactly the shirt that Fabian chose.

The algorithm knows who kept the garment and what size it was - and makes recommendations based on that.

But does that also work for Fabian's above-average height?

Sebastian Schulze, CEO Fit Analytics


»Because we reach more than 100 million people every month who have a size recommendation, we have a very, very strong representation in the population.

I would say that today we cover a very, very large part of the population.

Of course there are always people that we may not have had before, but that will help us to be better the next time a person who is similar comes along.

So that means that over time you have a very, very representative data set, which enables us today to give very good recommendations for everyone in the world.«

Schulze says that his tool saves an average of two to four percent on returns.

But the potential could be much greater.

Sebastian Schulze, CEO Fit Analytics


"You can roughly say that on average 20 to 25 percent of all purchases are made with the size advisor."

Leonie Voss, DER SPIEGEL


"So only a quarter actually use the Fit Finder?"

Sebastian Schulze, CEO Fit Analytics


»

Currently yes, on average.«

Leonie Voss, DER SPIEGEL


"That means that the hurdle for customers is still big, spending these two minutes or disclosing the data, what do you think?"

Sebastian Schulze, CEO Fit Analytics


»Of course there are always people who already know the right size.

And then there are always those who don't want to do it, who know that you can return goods free of charge.

That means we also try: how can you encourage them not to return and end up using the size advisor?”

Let's see if Fabian's size advice worked.

Leonie Voss, DER SPIEGEL


"Now I'm very excited."

Fabian Pieper, DER SPIEGEL


“Me too.

It's also not that often now that I've ordered clothes from a company I've never worn."

Leonie Voss, DER SPIEGEL


"Now is the decisive moment."

Fabian Pieper, DER SPIEGEL


"Now is the decisive moment."

Leonie Voss, DER SPIEGEL


"I would say you can just pull it over your t-shirt."

Fabian Pieper, DER SPIEGEL


»Yes, I'll just try it.

I'm going to fiddle around with this a bit.

Oh yes, that's almost possible.«

Leonie Voss, DER SPIEGEL


"So the sleeve length..."

Fabian Pieper, DER SPIEGEL


»... is close to the limit, I would say.

I'll close it."

Leonie Voss, DER SPIEGEL


»It might also be a bit short.

Yes, although you put it in your pants, right?

Although, it depends on your style.

I'll take a picture of you."

Fabian Pieper, DER SPIEGEL


"Take a picture of me."

Leonie Voss, DER SPIEGEL


»Open your arms.

So look.”

Fabian Pieper, DER SPIEGEL


»I've had it a lot worse, definitely.

I notice the wearing comfort when I pull up my sleeves: It pulls a bit.

I have the impulse, I would like to push it up.

And I know it from my shirts, they are a little bit longer.

They're also a tad longer here in body length."

Leonie Voss, DER SPIEGEL


»Yes, do you think you will keep it?

Or do we want to send it back?”

Fabian Pieper, DER SPIEGEL


»I think I would send it back, to be honest, because for the price I almost get a shirt that I know will fit really well.

And because of that, I would say: no.”

So Fabian has to send the shirt back like so many people do.

And some companies even seem to want it that way.

"Already there?

Always great pleasure.

Spring fashion comes by postman.«

A revolution that began in 1949 with the Werner Otto mail order business in Hamburg-Schnelsen.

Order from home - and even on account.

That shaped the Germans.

Since then, significantly more orders have been placed here than in many other European countries.

'And Anne in a slim blazer.

This is fashion that makes us prettier.

The right ideas on over 1000 pages.

Better something from Otto.

Otto mail order Hamburg.«

At the beginning of 2008, two Rhinelanders founded the start-up Zalando and from then on shaped the entire German e-commerce market with this advertising campaign.

»This online shop with a huge selection and an oversupply of brands.

Has anyone here ordered shoes from Zalando?

I just wanted to test it.

I found them in her sleeping bag.

And the ones in her locker. I can also send everything back.

Shipping is free there.«

Free returns have been part of the service promise of the Berlin company from the very beginning.

We wanted to know: If a return costs almost 20 euros on average, is it even worth it from an economic point of view?

Or is Zalando also trying to reduce returns?

Actually, we would have liked to have filmed the processing at Zalando and talked to someone about the company's returns management.

But that is not possible – because of Corona, says the spokesman.

Instead, we are given Stacia Carr as an interview partner.

She heads the Size and Fit department.

Their goal is - similar to Fit Analytics - to develop digital size advice.

Stacia Carr, Head of »Size and Fit« Zalando


»This is a 3D simulation of the avatar.

If I click here I can see how the garment falls on the body.

We are currently experimenting with this.

This is a thermal image showing where the garment is tight and where it is loose.

And here, in the blue spots, you can see how it fits and you can always switch back and forth between the thermal imaging and the fit of the fabric.”

So Zalando is also working on minimizing unnecessary returns, for example because people order the wrong size.

Nevertheless, according to their own statements, 50 percent of the ordered Zalando items are still sent back.

Industry insiders estimate that there are even more.


Overall, it seems to the company that it is more important to make online shopping as convenient as possible for customers than to generally minimize the number of returns.

Even when asked, Stacia Carr finds it difficult to name returns as a problem at all.

Stacia Carr, Head of »Size and Fit« Zalando


»I find it a bit simplistic to say that returns are bad.

I think you have to look at the entire ecosystem and think about where you can reduce CO2 emissions.

Leonie Voss, DER SPIEGEL


- "But it's better to order just one part and keep it than to order ten and return nine, right?"

Spokesman from the off:


»The problem is that Stacia is not a sustainability expert.«

Leonie Voss, DER SPIEGEL


"I know, but you work for a company that has built its entire market on this principle that..."

Stacia Carr, Head of »Size and Fit« Zalando


»Okay, that's enough.

I say time out and thank you.”

Zalando will answer all other questions about returns in writing.

The press department wrote in a statement via e-mail:

»Free shipping and returns have been an integral part of our business model and the service promise we make to our more than 48 million customers since day one.

Our goal is to bring the changing rooms to our customers' homes.«

So the company obviously has a great interest in people ordering a lot and driving sales up.

Business economists say: Reducing the volume of returns could be in everyone's interest.

This could even increase sales.

But first we are back in Münsterland.

Linda Stalljohann shows us that some customers take advantage of the free return option.

Linda Stalljohann, authorized signatory Fashion Logistics


"If we take a look at the pullover here."

Leonie Voss, DER SPIEGEL


"That's cheeky, isn't it, when you send something back?"

Linda Stalljohann, authorized signatory Fashion Logistics


»Well, we certainly don't need to question that, we can't repair it anymore either.

So the customer already knows exactly that he sent it back like this.

Also here for shoes.

When you see shoes.

They're definitely longer, they've also been worn outside, they're worn out, they're broken.

Unfortunately, we can only declare them as goods for disposal.

We can no longer repair them.«

Leonie Voss, DER SPIEGEL


»And how often does it happen that the items reach you in such a condition?«

Linda Stalljohann, Prokuristin Fashion Logistics
»Das ist eine ganz geringe Menge. Also so zwei Prozent ungefähr kann man sagen, die wirklich in so einem Zustand hier ankommt.«

Leonie Voss, DER SPIEGEL
»Und ob die Kundinnen oder Kunden für so was hier ihr Geld zurückbekommen haben, wissen Sie das?«

Linda Stalljohann, Prokuristin Fashion Logistics
»
Im Detail wissen wir das natürlich nicht bei jedem Kunden, aber zu vermuten ist das, dass der Kunde hierfür leider sein Geld wiederbekommen hat. Boah, das riecht.«

Leonie Voss, DER SPIEGEL
»Will man gar nicht anfassen.«

Linda Stalljohann, Prokuristin Fashion Logistics
»Nein.«

Leonie Voss, DER SPIEGEL
»Und was passiert jetzt mit dem Zeug?«

Linda Stalljohann, Prokuristin Fashion Logistics
»Also, wir verladen sie natürlich nur auf den nächsten Lkw. Was damit genau passiert, können wir auch nicht sagen, aber vermutlich werden diese Artikel wirklich entsorgt. Man versucht natürlich immer so viel wie möglich recyceln zu können, dass man auch noch mal die einzelnen Komponenten trennt. Aber wenn es wirklich so defekt ist, dann wird es entsorgt.«

Dass das kein gutes Modell sein kann, versteht sich eigentlich von selbst. Wie kann der Kreislauf von übermäßigen Bestellungen, Retouren und Vernichtung durchbrochen werden?

Mit Tricks aus der Verhaltenspsychologie. Das hat eine Unternehmensberatung aus Hamburg herausgefunden. Ihr Ziel war es, den Prozessprozess so zu beeinflussen, dass Kunden bewusster und passender einkaufen. Experten nennen das Nudging. Wie das funktioniert, erklärt uns Philipp Spreer. Er hat das weltweit größte Retouren-Experiment mit mehr als 100.000 Online-Shoppern geleitet.

Philipp Spreer, Unternehmensberater
»Wir haben Kunden, während sie real eingekauft haben, mit verschiedenen Nachhaltigkeits-Botschaften konfrontiert, live in der Situation, während sie die Kaufentscheidung getroffen haben.«

Online-Shoppern wurden also während des Bestellprozesses ganz individuelle Hinweise ausgespielt, die zu ihrem Einkaufsverhalten passen. Liegt ein Artikel beispielsweise in zwei Größen im Warenkorb, erscheint dieser:

»Viele Kunden finden direkt die richtige Größe mithilfe unserer Artikelbeschreibung und Größenberatung. Spar auch du die Rücksendungen und leiste einen wertvollen Beitrag für Umwelt und Klima.«

Ein kleiner Hinweis mit großer Wirkung: Wird die Größenberatung aktiv angepriesen, kann allein diese Botschaft die Retourenquote um 4,6 Prozent senken. Mit einem massiven Einfluss auch auf das Umsatzwachstum: Das kann dadurch um 9,5 Prozent gesteigert werden.
Laut Spreer steckt dahinter das Prinzip der »Sozialen Norm«: Menschen passen ihr Verhalten an externe Erwartungen an. Wenn also kommuniziert wird, dass viele andere Kunden Retouren vermeiden, dann motiviert das andere, es auch so zu machen. Die Folge: Kundinnen und Kunden suchen die Kleidung bewusster aus und behalten deswegen mehr. Der Umsatz für die Händler steigt.

Eine weitere Intervention zeigte eine ähnliche Wirkung.

Philipp Spreer, Unternehmensberater
»Die Botschaft lautete – wir haben tatsächlich eine größere Erhebung zu gemacht: 32 Minuten dauert es, eine Retoure abzuwickeln. Das ist der komplette Prozess von vorne bis hinten, das heißt vom Ausdrucken des Paketscheins, sofern er nicht beiliegt, über Klebeband suchen und Paket zukleben. Zur Post laufen vielleicht die Packstation zu. Ich muss mich in die Schlange stellen. All das zusammengenommen: 32 Minuten Lebenszeit fließt in eine Retoure. Und das war sozusagen der Verlust, den wir visualisiert haben. Und es hat sich herausgestellt, dass das sehr gut funktioniert.«

Diese Botschaft konnte im Experiment die Retourenrate sogar um fast fünf Prozent senken. Hochgerechnet wären das allein in Deutschland rund 15 Millionen Pakete weniger pro Jahr. Und ein weiterer positiver Nebeneffekt: Zusätzlich stieg in der Untersuchung auch das Umsatzwachstum.

Gucken wir zum Abschluss noch mal auf unseren Spielstand: Knapp 13.000 Retouren sind während unserer Doku durch die Republik kutschiert worden.

Leonie Voss, DER SPIEGEL


»

The number of returns could also be minimized without making returns immediately chargeable or even banning them altogether.

Some online retailers, for example, have also adopted the environmental information from Philip Spreer's experiment in order to minimize unnecessary returns.

Personally, I will definitely think twice more about whether I really need to order something online or whether I can just drive into town and go to a shop.«

Source: spiegel

All business articles on 2022-05-25

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